Preamble

The House met at Ten o'clock

PRAYERS

[Mr. Speaker in the Chair]

RAILWAY NETWORK MAP

10.5 a.m.

The Minister of Transport (Mrs. Barbara Castle): When the House debated transport policy last month I was able to report on the progress which the Chairman of the Railways Board and I had made on the determination of the new basic railway network. I am now glad to be able to tell the House that the network has been decided. A detailed map of the network, with an explanatory foreword by the Chairman and myself, will be available in the Vote Office at 11 o'clock.
In deciding which lines should be included I have taken account of my consultations with the planning Ministers, with the Economic Planning Councils, and with the railway unions. Above all, I have given full weight to the Government's determination that broader social and economic needs, not just narrow profitability, should count when it comes to national decisions on priorities. The result is a basic network of about 11,000 miles—some 3,000 miles longer than the likely outcome of the policy of the last Administration.
This will be a network of which the industry, and the country, can be proud. In itself, it will give a much-needed boost to railway efficiency and morale, but the Chairman and I do not intend that these 11,000 miles should simply remain in being; they must be a working system, continually developed with the aid of modern research and technology: and I shall see that this is done.
The Railways Board will now be reviewing the future of the lines outside the basic network. For these lines, it will be up to the Board to publish passenger closure proposals under Section 56 of the Transport Act if it so decides. But I

would remind the House that no such line will be closed without my individual consent, and only after a full examination by the Transport Users Consultative Committees and the Economic Planning Councils of the hardship and economic planning implications.
The basic network is a landmark in carrying out the railway policy set out in the Government's White Paper. It will help the railways to provide an efficient and flexible service to the public, fitted to the needs of the day. The Government are determined that a revitalised railway industry should play its full part in the integrated transport system of the country. This network will give them the right infrastructure to do it.

Mr. Webster: Is the right hon. Lady aware that it has been a growing practice, since morning Sittings began, to make Statements which are palatable to Government supporters in the afternoon and those which are unpalatable to them in the morning? Is she further aware that it is a monstrous discourtesy to the House to make a Statement at 10 o'clock, when the map which we are discussing, if we are to have any substance out of this Statement, will not be published for another 50 minutes, and that this is something which all my hon. Friends will wish to probe most deeply in relation to what is happening in their regions?
How does the right hon. Lady propose to maintain lines which are running at a loss? To what extent will the local authority contribute and to what extent will the central Government? What sanctions does she propose to use if a local authority does not contribute, and how will she undertake to keep these lines going if they are running at a loss? Is she further aware that, for every seven miles closed in the period 1951–64, she is closing 10 miles under her present proposals?

Mrs. Castle: I cannot accept for one moment that this statement is unpalatable to Government supporters. On the contrary, they realise full well the plans which were afoot under the policy of the previous Administration for a constant contraction of our railway service to a mere skeleton of a system—

Several Hon. Members: rose—

Mrs. Castle: Hon. Gentlemen must not jump up at this stage. The hon. Member for Weston-super-Mare (Mr. Webster) has asked me half a dozen questions and I must take some time to answer them. Of course, when the railway map is available for detailed consideration, it will be open to any hon. Member to put down any Questions or to probe in any way he likes, and I shall be only too delighted to try to deal with any particular points.
The hon. Member for Weston-super-Mare asked how unprofitable lines will be paid for. We have discussed this matter in the House; it was referred to in the White Paper and it was discussed in the debate on transport policy. There is at the moment a joint study going on between the Railways Board and myself, under a steering committee, of which the Joint Parliamentary Secretary is Chairman, and the job of which is to identify these socially necessary unprofitable lines and decide the amount of subsidy that will be necessary. We have made it clear that the Government, having adopted a policy of maintaining socially necessary lines—even if they do not pay—must, the Government having made that decision, give an open subsidy for those lines; and I am sure that the majority of hon. Members welcome this decision.
The position regarding local authorities has already been outlined in the White Paper. We will be moving forward towards the creation of conurbation transport authorities and—

Sir G. Nabarro: On a point of order. Is it not a fact that, in accordance with the custom and tradition of this House, you ask for supplementaries to be brief, Mr. Speaker? That being so, should you—

Mr. Manuel: Sit down.

Sir G. Nabarro: I was asking, Mr. Speaker—[Interruption.]

Mr. Speaker: Order. There is too much morning enthusiasm.

Sir G. Nabarro: Are we to have inflicted upon us by Ministers long answers of this type? Cannot Ministers be brief, as back benchers are asked to be brief?

Mr. Speaker: Order. I allow a certain amount of latitude or longitude to the Front Bench spokesmen.

Sir G. Nabarro: There is too much longitude.

Mrs. Castle: As I have had a number of questions inflicted on me by the hon. Member for Weston-super-Mare—[Interruption.]—presumably he wants them answered. It is intolerable if, when I am attempting to answer them, hon. Gentlemen opposite complain.
I was explaining, regarding local authorities, that the new transportation authorities, under the new arrangements for the general help which the Government are giving to public transport, will take over responsibility for deciding which socially necessary lines they want as part of their local transport plans. In such a situation, the responsibility for maintaining those lines could gradually transfer to the local authorities. In the meantime, the subsidy will be a Government subsidy, although we leave it open to individual local authorities to approach the Railways Board and try to negotiate the retention of a purely local line on the basis that they will meet the particular subsidy.

Mr. Manuel: Is my right hon. Friend aware that there will be no discourtesies or competition for discourtesy from this side of the House arising from her statement? Is she aware that we welcome it and that we are, by it, redeeming some of the pledges which we made at the General Election? Is she aware that one of the important results of her statement will be the heartening effect it will have on railway workers throughout the country? I assure my right hon. Friend that she will have the full backing of the influential railway trade unions in this matter.

Mr. Speaker: Order. Even compliments must be phrased in an interrogatory form.

Mrs. Castle: I am grateful to my hon. Friend for those remarks.

Mr. John Hall: The Minister has made an important and interesting statement. Would not she agree—and, as a constituent of mine, I am sure that she will agree—that it is difficult to be sure exactly what she is stating without our having the advantage of having looked at the map first? I cannot believe that it is possible for any hon. Member to


say unreservedly that he welcomes her statement without having seen the effect of it by having looked at the map. Would it not have been more convenient to the House—I say nothing about discourtesy because I am sure that the right hon. Lady would not treat the House in a discourteous manner—if the map had been published earlier, instead of at 11 o'clock, and her statement made this afternoon, since we would then have been able to examine the matter more closely, and—

Mr. Speaker: Order. Questions must be brief.

Mr. Hall: Would not the right hon. Lady agree that we would have been able to examine the matter more closely and been able to ask questions more intelligently than we are able to do without the map?

Mrs. Castle: It is possible to welcome unreservedly the two principles which I have laid down. The first is that the Government do not believe that we can have a satisfactory railway network in Britain on the basis of purely commercial considerations. This is, therefore, a fundamental change of policy and, on that principle, hon. Members can make up their minds. The second point to be welcomed is the fact that we are going to give a period of stabilisation to the railway industry on the basis of a railway network which is about 3,000 miles longer than it would otherwise have been.
To answer the hon. Gentleman's question about the availability of the map, even if it had been released earlier, this is inevitably such a detailed subject that at this stage it is possible to discuss only the broad principles. However, it will be open to hon. Members to put down Questions about details of the matter in the normal way.

Mr. Tudor Watkins: Is my right hon. Friend aware that the Central Wales line was examined by the T.U.C.C. about five years ago? Is it her intention that this line should again be examined by herself and the T.U.C.C.?

Mrs. Castle: Yes, Sir, that is so. The Central Wales line will be one of the lines on the map for further consideration. However, I repeat that those lines on the man which are not included in the basic

network will not necessarily all be closed. They are simply lines which need further examination so that we can see whether they should be retained, whether they should be modified or whether alternative methods can be found to cater for the people of the area.

Mr. Peyton: Would not the right hon. Lady agree that it is rather odd for her to have made a statement like this without hon. Members having the map, particularly since the map will be available in only half on hour's time? I do not wish to accuse the right hon. Lady of discourtesy, but I urge her not to follow the example of some other members of the present Administration, and to show at least some courtesy to the House of Commons.
Accepting all she says about socially necessary things, is she aware that one socially necessary thing always competes against another socially necessary thing for the limited resources that are available? Will she, therefore, when making her judgments about what is necessary, at least bear in mind and examine carefully those instances where local authorities press for the preservation of a line—[HON. MEMBERS: "Too long."]—I apologise to the Minister for the barking that is coming from her hon. Friends; it is making my question that much longer—at the same time as they maintain an uneconomic bus service in competition with it?

Mrs. Castle: I naturally do not want to be discourteous to the House, and did not think that I was being discourteous. It is quite normal practice for a Minister to make a statement and to draw attention to material that is being placed in the Vote Office. I repeat that this is inevitably a detailed matter which could not possibly, even if the map were available now, be examined in great detail in the form of question and answer following a statement.
As to what is socially necessary, we of course recognise that there must be a balance here—a balance on the basis of social cost benefit. This is the principle that we are bringing into our consideration of these lines. One factor which we shall take into account—it is important that we should, because this country cannot afford to throw money about just for the fun of it—in examining the grey


lines on the map is to consider what are the alternatives and whether a more integrated local policy might be able to make the line pay.

Mr. Dalyell: Will my right hon. Friend bear in mind the broader social and economic considerations in central and south Scotland? Is she in a position to say anything about the Edinburgh—Carlisle line?

Mrs. Castle: As my hon. Friend is no doubt aware, the Edinburgh—Carlisle line has already been proposed for closure and is already coming under the normal examination. [HON. MEMBERS: "Oh!"] This preceded the publication of the map, and whether in the end the Edinburgh—Carlisle line finishes up as one of the parts of the stabilised network must depend on the outcome of this examination.

Mr. Alasdair Mackenzie: While there is no reference to Scotland in the Minister's statement, we welcome the fact that it says that social and economic needs will be considered in coming to decisions on closures, and so forth. Is she aware that this affects my part of the country, the Highlands of Scotland, very much? I should like an assurance from the right hon. Lady that there will be no further rundown in railway services in the Highlands of Scotland, because we are at the moment suffering a great deal on account of the rundown that has taken place in the past.

Mrs. Castle: I am sure that the hon. Gentleman will be delighted to know that as a result of my reversal of the previous Administration's policy, the line routes included in the basic network map include the Perth-Thurso line, which would have disappeared, the Aberdeen-Inverness line, which would have disappeared, the Helensburgh-Oban line, which would have disappeared, and a number of others.

Mr. Speaker: Mr. Mendelson.

Mr. Mendelson: rose—[Interruption.]

Mr. Speaker: Order.

Mr. Manuel: On a point of order, Mr. Speaker. I ask, with the greatest respect to you, why, if hon. Members on this side seem to be pulled up right away, hon. and right hon. Members

opposite get the utmost liberty to throw remarks about in this Chamber.

Mr. Speaker: I call to order hon. Members who are misbehaving when I notice them. I happened to notice the hon. Member concerned. Mr. Mendelson.

Mr. Mendelson: I should like to ask about the decisions which my right hon. Friend reserves to herself after these matters have been before the Economic Development Council. Would she bear in mind that a conflict is developing between the actual need to save on certain local lines and the future economic development of the areas they serve? The general policy of the Cabinet to have diversity of industry and new industries in certain old industrial areas is now being contradicted by the decision to close or drastically revise certain lines that should be kept open on economic grounds.

Mrs. Castle: I am very acutely aware of the need to take into consideration possible industrial and housing development in an area. This is one of the facts which should be very much taken care of by the Economic Planning Councils, and the basic map has been drawn up in consultation with them. The responsibility for the final network is mine, but the councils with this kind of idea in mind, have put many proposals to me to which I have responded in drawing up the basic network. I repeat that when we examine the closures which will have to be considered in the next few months, I shall have this very much in mind as well.

Mr. Edward M. Taylor: As the present Government have either closed or plan the closure of 4,991 miles of railway line compared with 3,480 miles in the 13 years when the previous Government were in power, does not the right hon. Lady agree that it is outrageous that we should have this statement made without the map? Why could the map not have been given to us by 10 a.m., in time for her statement?
Will the right hon. Lady also—

Mr. Speaker: Order. Supplementary questions must be brief.

Mr. Taylor: —try to explain what is meant by gradually transferring the burden to local authorities? Does this


mean that the 11,000 miles target can be achieved only if ratepayers in certain areas accept a further heavy burden? If so, is this wise in view of the already heavy burden that exists?

Mrs. Castle: I hope that we can nail once and for all the mythology that hon. Members opposite had tried to build up about closures. The truth is that more mileage was planned for closure in the last year of Conservative government than there has been in the whole life of this Government. The right hon. Member for Wallasey (Mr. Marples) merely refused 10 closures during his period of office; my right hon. Friend the Member for Hamilton (Mr. Tom Fraser) and I refused 29 in our two years of responsibility. Hon. Members will be able to see perfectly clearly what we have done in fixing this basic network to reverse a situation under which, under the logic of the policy of the previous Administration, we should have had something like 4,800 passenger miles left on our railway network. That was a fact, and this is the policy we have reversed.
As to local councils, the answer to the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) is that it does not mean that the preservation of 11,000 route miles depends on the ratepayers' carrying this burden.

Dr. John Dunwoody: May I congratulate my right hon. Friend on allaying the doubts and anxieties that have hung over the railway industry since the days when the present Opposition were in power? Can she assure the House that the basic railway network as it is to be published will remain for the foreseeable future? Will she agree that if local authorities are to play a part in financing the maintenance of unprofitable branch lines, it may mean some changes in the criteria by which the central Government support local government? Will she consider consulting her right hon. Friend the Minister of Housing and Local Government with this end in view?

Mrs. Castle: I am grateful to my hon. Friend. As a result of this reversal of policy, new hope is being brought to the South-West, because included in the basic network will be the Plymouth-Penzance line, the Salisbury-Exeter and

Okehampton-Barnstaple line, and the Castle Cary-Dorchester line. These are some of the examples of what will be in the basic network map. I can assure my hon. Friend that no proposals for the closure of any lines now in the basic network will be made in the foreseeable future.
On the local authority point, quite clearly it would be ridiculous to transfer to existing local authorities the Exchequer burden that we are openly taking here. There must be a move towards the creation of wider transport authorities in the context of the grant policy for public transport as a whole before a transfer of the burden could even be contemplated. In addition, I repeat that some local authorities have said that there are purely local lines that might otherwise be closed under Section 56 but which they want a chance to try to keep open by local subsidy. I have made it clear that if they want to do that, it will be open to them to negotiate with the British Railways Board.

Several Hon. Members: rose—

Mr. Speaker: Order. We must cut down the length of supplementary questions and answers if possible. Sir John Eden.

Sir J. Eden: Before leaving this matter, Mr. Speaker, may we hear from the right hon. Lady at what time the map was given to the Press?

Sir G. Nabarro: Having regard to the open-ended subsidy to which the Minister referred, whatever that jargon may mean, has she calculated what this will add to the existing rate of loss on the railways of £130 million per annum, when she abandons a commercial enterprise in favour of a Ministry of Social Security exercise?

Mrs. Castle: Hon. Members opposite had better make up their minds whether their objection is that I am to subsidise too much or whether it is that no lines are to be closed at all. This has been the duplicity of the policy of hon. Members opposite for years—[Interruption.]—and it has bedevilled the case—

Mr. Barber: On a point of order, Mr. Speaker. Is it in order for the Minister to accuse hon. Members on this side of duplicity?

Mr. Speaker: I think that the right hon. Gentleman is being unduly sensitive.

Mrs. Castle: It is—

Hon. Members: Withdraw.

Mr. Speaker: Order. We should be able to proceed more quietly.

Mrs. Castle: It is this which has be-devilled the creation of a proper railways policy. I do not know what the hon. Member for Worcestershire, South (Sir G. Nabarro) means by his reference to "open-ended subsidy". I have made it clear that, on the contrary, in every case where the Government decide that a line is socially necessary, the joint survey to which I have referred will examine in great detail what economies can be brought into play in order to reduce the loss before deciding the size of the contribution which has to be made on social grounds by the Government.
This will not add to the deficit of the Board, because the position at the moment is that, where closures are refused, the cost falls on the deficit anyhow. The right hon. Member for Wallasey refused certain closures on the one hand, while, on the other, lecturing the Railways Board about the need to pay its way. No one could hope in that way to get an efficiency target for British Railways that it could hope to reach.

Mr. Ridley: On a point order, Mr. Speaker. May we take it that my right hon. and hon. Friends will be allowed to ask longer supplementary questions in view of the disproportionate amount of time being taken by the right hon. Lady's answers?

Mr. Speaker: I have already commented on that matter.

Mrs. Castle.: The trouble is that I get such long questions, so I have to give long answers.

Sir G. Nabarro: On a point of order, Mr. Speaker. That jibe was directed at me. Is it not a fact that my supplementary question was a masterpiece of brevity?

Mrs. Castle: Well, it certainly was not a masterpiece of sanity.

Sir G. Nabarro: You have constantly ruled, Mr. Speaker, that supplementary questions should be brief. If my supple-

mentary question had not been brief, you would have been on your feet in a split second. But you made no attempt to halt my question, which was a masterpiece of brevity. Would you, therefore, ask the right hon. Lady to withdraw her shocking innuendo that my supplementary was insane and not brief?

Mr. Speaker: The last question is not part of the hon. Gentleman's point of order, the first part of which was a statement of fact.

Sir G. Nabarro: You agree with it?

Mr. Speaker: Order. The hon. Gentleman must contain himself a little. We must get on.

Sir J. Eden: Has the right hon. Lady made any assessment of the likely increase to the taxpayer of the Government's policy?

Mrs. Castle: Perhaps I should explain what happens if a closure is refused even though the line is losing money. This cost falls on the deficit, although it is the Government and Parliament who have decided that the line should remain open. In such a situation, it is obvious common sense to have a separate social account so that, Parliament having willed a line to be kept open, Parliament will put it not on the deficit but under a special social subsidy. The amount involved cannot be foreseen until the joint survey has examined each socially necessary line, what economies can be made and what size of subsidy will be required.

Several Hon. Members: rose—

Mr. Speaker: Order. We cannot debate this now. Mr. Marsh—statement.

Mr. Barber: On a point of order, Mr. Speaker. I wish to seek your guidance on an important point. According to the Order Paper for this morning, the Minister of Power is now to make a statement, and the subject is described as being "National Steel Corporation salaries". My question is not concerned with the content of the statement, which we have not yet heard, but with the subject and timing.
This is undeniably a matter of great importance. First, it is now more than four months since we asked for a statement on the subject. Secondly, the right hon. Gentleman has told us that this


matter raises the whole question of the incomes policy and of the salary structure of the other nationalised industries. Thirdly, it is on record and is not a surmise that there are wide divergencies of opinion in the party opposite as to what is necessary and what the answer to the problem should be.
The Leader of the House said on 14th December:
Let me emphasise that important or controversial statements … will still be taken at 3.30 p.m."—[OFFICIAL REPORT, 14th December, 1966; Vol. 738, c. 490.]
Is it not an outrageous abuse of the whole idea of morning Sittings that a controversial matter of this importance should be deliberately slipped in at a time when the Government knew that the majority of Labour Members would be absent at another meeting in this building?

Several Hon. Members: rose—

Mr. Biffen: On a point of order.

Mr. Speaker: Mr. Biffen—point of order?

Mr. Biffen: It is the same point of order, Mr. Speaker.

Mr. Speaker: If it is the same point of order, then surely there is no need to make it again.

Mr. Biffen: Further to that point of order, Mr. Speaker. May I also bring to your attention the fact that the right hon. Lady the Minister of Transport said that her statement involved a fundamental change of policy? I submit that this clearly indicates that her statement was conceived to be one of major significance and falls without the terms set by the Leader of the House.

Mr. Speaker: It would be quite impossible for Mr. Speaker if he tried to decide which of the matters brought before the House in the morning fell within the terms of the statement made by the Leader of the House in the debate on morning Sittings. This must be a matter for the judgment of the Leader of the House and—

Sir G. Nabarro: Where is he?

Mr. Speaker: Order. The hon. Member for Worcestershire, South (Sir G. Nabarro) must cease interrupting.
This must be a matter for the judgment of the Leader of the House and the House and the criticisms directed must be political criticisms and not questions of order through the Chair.

Mr. Peyton: Further to that point of order, Mr. Speaker. What disturbs me is that, through what seems to me to be the customary duplicity of the Government, the Chair is constantly being made the target of attack quite unnecessarily and wrongly.

Mr. Speaker: Order. I have never been aware that the Chair has been made the subject of attack.

Mr. Peyton: I am sorry, Mr. Speaker, but surely the Chair comes between the Government and the Opposition to a very wrong and undesirable extent. I put it to you—

Mr. Speaker: Order. It was just for that reason that I ruled that this was not a point for me.

Mr. Patrick Jenkin: On a point of order, Mr. Speaker. Your Ruling that back benchers have no recourse to the Chair to insist on the keeping of the promise given to the House by the Leader of the House on 14th December places us in a very difficult position. Do we have no protection so as to prevent the Minister of Power from going back on the promise given by the Leader of the House? These were supposed to be non-controversial statements of secondary importance?

Mr. Speaker: Again the hon. Gentleman is trying to bring the Chair into this. The back bencher is not without protection. He has hundreds of Parliamentary remedies. I have known them to be used. What the Chair refuses to do is to take any part in the dispute between the two sides of the House.

Mr. John Hall: Further to that point of order, Mr. Speaker. I can understand the difficult position in which you, as Mr. Speaker, are placed. Nevertheless, I am sure you appreciate the problems which face back benchers on both sides. As I understood it, when we agreed to morning Sittings, it was that statements made in the morning would be, on the whole, of an uncontroversial nature and that any statements likely to be controversial and that any announcements of policy—

Mr. Speaker: Order. This is exactly the same point on which I have already ruled.

Mr. Carlisle: May I ask, Mr. Speaker, a question on the Ruling you have made that it is not open to the Chair to interpret what is an important statement? What protection in those circumstances do back benchers have? With respect, surely the Chair has always taken upon itself this duty? For example, if the adjournment of the House is moved, it interprets what is a definite matter of urgency. Surely, it must be for the Chair to interpret whether undertakings given to the House by the Leader of the House are being carried out or not.

Mr. Speaker: That is most ingeniously put, but on that issue of Standing Order No. 9 I have the instructions of the House and my predecessors had instructions. I have not been instructed by the House to decide the kind of questions which, in my judgment, should be brought by the Leader of the House before the House on morning sittings. It would indeed be untenable if Mr. Speaker were placed in that position.

The Minister of Power (Mr. Richard Marsh): Mr. Speaker, would it not help the House if I were allowed to make the statement, and hon. Members would then be in a better position to judge whether it is controversial?

Mr. Barber: Perhaps I can help. I appreciate that the House wants to get on with its business. Now that the Patronage Secretary has arrived, and as it is clear, whatever the Minister says, that the statement will be controversial and is certainly of great importance, I wonder whether we could bring this matter to a satisfactory conclusion if the Minister would consult the Patronage Secretary and make his statement at a time when we would have a fuller House? I repeat that it is four months since we asked the Minister to make a statement, and, therefore, half a day or a day is neither here nor there. We should like this statement to be made in front of a full House. If this could be done, we could then get on with our business.

Mr. Speaker: Points of order are very interesting, but they tend to waste the time of the House. We have quite a lot of business this morning.

Mr. Mikardo: On a point of order, Mr. Speaker. Would you enlighten me as to whether the term "duplicity" implied by the hon. Member for Peyton on members of the Government is or is not a Parliamentary expression?

Mr. Speaker: The hon. Gentleman was not here when exactly the same term was used some time ago by a Minister. I ruled on it then.

Several Hon. Members: rose—

Mr. Speaker: Order. I want to get on with the business of the House.

Mr. Peyton: Further to that point of order. As the hon. Member for Poplar (Mr. Mikardo) specifically referred to myself, I think, though he mentioned my name and not my constituency—

Mr. Speaker: Order. I ruled some time ago on the question of the use of the word "duplicity".

Sir J. Eden: Since it is important that we should try to get the new morning sittings procedure correct, may I make this submission? What you are saying, Sir, is that you have no control whatsoever over the content or nature of statements that the Government choose to make. In these circumstances, are we not right completely to distrust the word of the Leader of the House?

Mr. Speaker: Whether hon. Members trust or distrust the word of the Leader of the House is not for the Chair. I believe that such a phenomenon has happened in history.

Mr. Nott: Mr. Speaker, the Minister of Transport described the statement which she made as of fundamental importance. That will be within the recollection of the Chair. Is there no way in which back benchers—

Mr. Speaker: A point of order becomes no more a point of order by being repeated again and again.

Sir G. Nabarro: Further to the original point of order which we are supposed to be on, Mr. Speaker. In the course of every one of your answers you have referred to the Leader of the House and disclaimed any responsibility of the Chair to adjudicate as to what is a matter of importance or otherwise. In these cirsumstances, is it not the greatest discourtesy to the entire House that the Leader


of the House is always missing on these occasions? Cannot you send for the Leader of the House, Sir?

Mr. Speaker: The last question is rhetorical. The hon. Gentleman knows that that is not a matter for me.

Several Hon. Members: rose—

Mr. Peyton: On a point of order, Mr. Speaker.

Mr. Speaker: Order. I refuse to hear the hon. Gentleman on a second point of order.

Mr. Ridley: Further to this point of order. It is quite clear that the House feels strongly about this matter and it is the first occasion on which important and controversial statements have been made at a morning sitting. It would be normal, if this were not a morning sitting, to involve you, Sir, by moving the Adjournment of the House under Standing Order No. 9. Then you, Mr. Speaker, would be involved to the extent that you would have to decide whether this was a definite matter of urgent public importance. Since this is a morning sitting, I believe I am right in saying that it is not possible to move the Adjournment of the House under Standing Order No. 9. Therefore, the only remedy left to hon. Members in this highly important matter is to move that the House do now adjourn. Accordingly, I beg to move, That this House do now adjourn.

Mr. Speaker: I am not prepared to accept that Motion. Mr. Marsh, Statement.

NATIONAL STEEL CORPORATION (SALARIES)

The Minister of Power (Mr. Richard Marsh): With your permission, Mr. Speaker, I should like to make a statement.
The new National Steel Corporation will be the biggest manufacturing complex in the U.K. and one of the biggest in the world. The success of steel nationalisation is essential therefore to the nation's economic well-being. This in turn depends on the extent to which the Corporation can keep and strengthen managerial talent throughout the industry. In a mixed economy the public sector of the steel industry must be able to develop and hold a fair proportion of the best managerial talent and, although it would not be appropriate for it to try to match the highest levels of salaries paid in the private sector, the ceiling provided by the Board salaries must be at a level which will not depress the salary structure lower down in the industry.
In the light of these considerations, the Government have decided that the annual salary range normally applicable to members of the National Steel Corporation should be:


Deputy Chairmen
£20–24,000


Full-time Members
£15–19.000


Part-time Members
£1,000


The salary range proposed for deputy chairmen and full-time members of the Corporation is broadly in line with the salaries now earned by the chairmen and managing directors, respectively, of the major steel companies, which are much smaller organisations than the Corporation. They are below the higher levels of salary in other fields of industry. Nevertheless, in view of the Government's incomes policy, these salary ranges will be cut by 12½ per cent. for a period of two years from the date of establishment of the Corporation.

Mr. Barber: Is the right hon. Gentleman aware that, contrary to the undertaking given by the Leader of the House, he has made what undoubtedly is a very important statement, bearing, as it does, not only upon the National Steel Corporation, but upon incomes policy and upon those who sit on the boards of other nationalised industries?
I would like to put to the Minister a number of questions briefly. First, will he tell us something about the salary of the Chairman? Secondly, were these the salary levels which were recommended to him by the Organising Committee, which was specifically set up, among other things, to advise him on this point? If these were not the Organising Committee's recommendations, what were the recommendations of that Committee?
Thirdly, while congratulating the right hon. Gentleman on over-riding the majority of his supporters and agreeing to Beeching-scale salaries, may I ask him what effect this decision will have on the salary structure of other nationalised industries, which was one of the factors mentioned by the right hon. Gentleman himself specifically at Question Time on 21st February? In other words, does he agree that they will now have to be jacked up?
Finally, if a new company were setting up in the private sector, presumably the remuneration of those in charge of the company would not be limited for a period of two years. If that is so, why is the right hon. Gentleman insisting on this special limitation on the National Steel Corporation, which the right hon. Gentleman has repeatedly said, time and time again, should be run on strictly commercial lines like any other enterprise in the private sector?

Mr. Marsh: Lord Melchett, at his own request, will serve as Chairman for the next two years on his present personal salary of £16,000 a year, which is the salary he is now paid as Chairman of the Organising Committee, but substantially less than that which he earned before his present appointment. I would link that, if I may, with the last point which the right hon. Gentleman asked, on the limitation of these salaries, their abatement, because of the incomes policy.
The purpose of this exercise is to ensure that there is, within the industry, a ceiling at a sufficient level to enable salaries underneath to be equated with their opposite numbers in private industry. Therefore, although I think that it is important to get this ceiling, the important factor about the ceiling is the substantive figure rather than the actual take-home figure. This is one of the reasons why Lord Melchett took the line that he did not particularly want his own

salary changed. The right hon. Gentleman also raised the question of the Organising Committee's recommendations to me. These are, of course, confidential. The position of the other nationalised industries was raised. These are not in question at the moment, although steel is in a special position here—

Mr. Orme: Oh.

Mr. Marsh: Oh, yes, even if my hon. Friend does not recognise this. Steel is in a special position for two reasons, that it is not a monopoly industry—people can go elsewhere—and that it is a manufacturing industry. That is why these scales have to bear some relationship to those paid in manufacturing industry. However, in terms of the incomes policy, these are not increases; they are not in excess of such salaries already being received.

Mr. O'Malley: Since, with the setting up of the National Steel Corporation, there will be a substantial reduction in the number of directors in the steel industry, what kind of saving does my right hon. Friend envisage as a result of this new structure, with salaries at the present level? Will there be any existing contract of employment which will continue, under the guarantee which the Government have given, by which any new member will be getting more than the salaries which my right hon. Friend has announced?

Mr. Marsh: Yes. As in the case of all nationalisation Measures, there is, of course, personal protection for those people at present in the industry and some of those salaries are, in fact, in excess of some of these that I have announced. My hon. Friend also talked about the number of directors, which is an important point to bear in mind. Under the new Corporation, the number of full-time functional directors will be about six, compared with a total at present in the industry of about 200.

Mr. J. H. Osborn: While welcoming the nature of the right hon. Gentleman's statement as a move in the right direction, may I assure him that all those with the interests of the industry at heart will accept this as a bold gesture in the right direction? What consideration will he give to other emoluments, such as pensions, expenses and other factors?

Mr. Marsh: The question of expenses, as with all nationalised industries, is merely the repayment of expenses necessarily incurred in the course of the job. The pension schemes will be the same as in the nationalised industries.

Mr. Strauss: Is my right hon. Friend aware that anyone who has any experience, as I have had, of setting up a steel corporation and fixing the salaries, must be convinced that it is essential, if we are to have a successful nationalised steel industry, to get the very best and outstanding men in industry on the board and to pay whatever salaries are necessary, that the alternative of getting retired people from the Armed Services or the Civil Service, excellent though they may be, is not good enough, and that he has done exactly the right thing to make the Corporation a great success, of which he and the country can be proud?

Mr. Marsh: I am grateful to my right hon. Friend. Not surprisingly, I agree with his comments. It has to be remembered that this will be a functional board. Its members will have specific line responsibilities. As such, these jobs must be filled with the best people we can get, and it is my intention—I am sure that it would be the intention of all my hon. Friends who believe in public ownership—that the National Steel Corporation must be in the market for any talent that it wants, at the prices which attract it.

Mr. Boyd-Carpenter: Does the right hon. Gentleman regard this statement as being, in the words of the Leader of the House, as "of secondary importance"? Does he now recall with regret, in view of his powerful arguments for the salaries, the criticisms which his right hon. Friends made some years ago of the salary arrangements made for Lord Beeching? Does he think that, in the light of these arguments, he can hold the salaries of the other nationalised industries at their present relatively low level? Fourth, is he not aware that most people outside will regard the technique of fixing a large salary and then temporarily knocking 12½ per cent. off it as so much eye-wash?

Mr. Marsh: I do not know whether the right hon. Gentleman would regard a 12½ per cent. cut in his salary as eye-wash—

Mr. Boyd-Carpenter: Not if it were one that I was not receiving in the job.

Mr. Marsh: No, the right hon. Gentleman does not understand the position. These people are getting these levels of salaries now. These are not people from nationalised industries—that is the point. The important thing about abating the salaries is to fix the substantive scale, which provides the ceiling within which the management and middle management is contained. On the right hon. Gentleman's other point, I should not have thought that this question was controversial. It seems to me that any statement, the logic of which is so crystal clear, would be clearly acceptable on both sides.

Mr. Mikardo: Does my right hon. Friend expect an enthusiastic welcome for his statement from the pottery workers, whom we will this evening legislate to prevent from getting a few shillings a week increase?

Mr. Marsh: I should like to deal with this point in general rather than in the particular. The whole question of the incomes policy is very important and controversial—

Mr. Orme: You have made nonsense of it.

Mr. Marsh: My hon. Friend may think so. I should be grateful to deal with this point, because the incomes policy is important. These are not increases in salaries. This is a new scale for a new job for people who have not been employed in that job before. Second, these are not increases, in some cases, to the people who are taking the jobs, because they are already receiving salaries at this level. Third, these are by no means high salaries compared with existing salaries in the rest of industry.
Therefore, there can be no argument—this has nothing to do with the incomes policy at all, because it does not involve increases in pay. I put the simple and important proposition to my hon. Friends that the alternative is to try to run this nationalised industry, with all its implications for the economy, with the people whom we can get, who would not be the people we necessarily wanted.

Several Hon. Members: rose—

Mr. Mikardo: On a point of order. Is there any way in which one can secure that the Minister answers the question put to him instead of a quite different one? I asked one susceptible to a "Yes" or "No" answer, whether he expected an enthusiastic welcome—

Mr. Speaker: Order. That is a singularly naïve point of order from an experienced Parliamentarian.

Mr. Patrick Jenkin: May I probe this 12½ per cent. nonsense? Is the right hon. Gentleman aware that he has emphasised the importance of an adequate salary structure and has acknowledged that this is one of the principal reasons why he has fixed the level which he has? He then announced that there would be a two-year moratorium, during which the salaries will be l2½ per cent. below that level. Is this reduction, therefore, to apply to all new appointments of regional directors or managaing directors to the new companies? Does he envisage that, during these two years, these senior officials down the line might receive more than the members of the Corporation? Does he realise that this would be a bit of a nonsense?

Mr. Marsh: These salaries apply purely to the members of the Corporation itself, the Chairman, the Deputy Chairmen, and the functional directors. The rest of the salaries are, of course, fixed by the Corporation. As regards the abatement, those people with whom I have discussed it so far, who are being considered for appointments in the light of the various implications which we face, see no difficulty about this. They recognise the implications and are perfectly happy, in a publicly-spirited way, to accept them.

Mr. Dickens: Is my right hon. Friend aware that whilst we recognise the obvious difficulties in dealing with salary structures in a mixed economy, he has set a grave and dangerous precedent in seeming to replace a rational salary structure in the public sector with an irrational salary structure from the private sector? Is he also aware that his statement is bound to cause widespread resentment amongst board members in all the existing public corporations and senior officials throughout the Government service?

Mr. Marsh: It has never been in doubt that however one dealt with the subject it provided difficulties. It is easy to list all the difficulties, but the problem is finding some of the answers. On the rational structure in the publicly-owned industries—if it is referred to as such—and the irrational structure in the private sector, the fact is that the Corporation, unlike the gas, electricity and coal industries, will not have a monopoly. There will be a private sector of over 200 steel companies, and there is also a large engineering sector. If one sets out to produce the best people there is no alternative to this approach even with all the problems.

Mr. John Hall: Whilst I congratulate the Minister on what the whole House would agree is a courageous approach to the problem, would he expand a little on the effect of his statement on the other nationalised industries? Is it because the steel industry is not a monopoly that he had to pay the market rate for the job? Does that mean that the Government are using a monopoly position in other State enterprises to depress salary standards?

Mr. Marsh: There is no single salary scale in the nationalised industries. There is already more than one salary range. This is just another for a different industry. The nationalised industries are looked at together from time to time, but my statement deals purely with the one industry, not for increasing anybody's salaries but producing a new salary scale for new people for a new job.

Mr. Richard: Can my right hon. Friend give an assurance that the future efficiency of the industry was the main factor in his mind in arriving at his decision? Can he also give the House au unqualified assurance that, having tested the market to see who was available for these jobs, his decision was based solely on the fact that it is necessary to secure the men who are hest fitted to run the industry in his view?

Mr. Marsh: Yes, certainly. The importance of the future efficiency of the industry to the economy as a whole should not be under-estimated. It is the biggest manufacturing complex in Britain, bar none. It has an investment of £1,400 million and an annual turnover of £1,000 million. It must be efficient, and when


one is trying to ensure greater efficiency than was perhaps always the case in the past one looks for the best managers one can get. In my view, it would be lunacy to lose people one wants for an industry like this in an effort to save a small amount of money.

Mr. Biffen: As commercial salaries are to be paid to the executives, does the Minister expect to see the organisation earn commercial profits? When he talks about the difference between the Corporation and the other nationalised industries is he not being a little disingenuous? Do not the airlines and the railways compete with other forms of transportation, and do not gas, electricity and coal compete with other forms of energy? Will he look at this again?

Mr. Marsh: One is bound to look at this as a commercially viable unit, taking profit into account, I agree. The main purpose of nationalising the industry was that many of us felt that it had been badly run in the past. I would expect to see from the Corporation eventually rather better results commercially than there have been recently.

Mr. Hugh D. Brown: While I recognise my right hon. Friend's dilemma, would he publish in detail, and resist the blandishments of the directors' lobby on the opposite side of the House, the savings that will be made by the reduction in the salaries or in the numbers paid in the new Corporation? Would he also consider referring the grossly exaggerated level of remuneration that now seems to be paid in the private sector either to the D.E.A. for a period of permanent freeze or to my right hon. Friend the Minister of Social Security for the relief of hardship?

Mr. Marsh: The question of referring general salaries to somebody else is not a point for me. It would be almost impossible to publish the savings in terms of personnel, because I do not know how many people the Corporation will finish up with. One would expect big savings in manpower at every level as a result of public ownership. We shall have a board of half a dozen or so functional directors, a deputy-chairman and chair-

man, and there will be many fewer national directors than in the past.

Mr. Peyton: Does the Minister not think that it is unwise as well as unfair to seek to distinguish between executives in, say, the gas or electricity industries, which he specifically mentioned, on the grounds that they have nowhere else to go? That seems wrong. Will he consider giving the 12½ per cent. temporary deductions to a suitable canine charity?

Mr. Marsh: I think that we are all getting rather bored with the last point. On the question of people having nowhere else to go, I was seeking to make the point that nationalising a manufacturing industry is a different exercise from nationalising a service industry. Of course one does not differentiate—[Interruption.] That is true; there is a whole range of difference—between the salary structures on that basis. This is not a question of increasing salaries. Hon. Members talked as if there were one nationalised industry scale. That is not true. There is a number, and this is one more for this industry.

Mr. Orme: If as my right hon. Friend says, this does not make a nonsense of the incomes policy, why is the 12½ per cent. reduction recommended? Did that extraordinary recommendation come from Mr. Aubrey Jones and his merry men, or from where? Why must he pay salaries in line with what is now being earned by private monopoly inside the steel industry, and why can he not employ technocrats at reasonable salaries to run the industry instead of the inflated salaries of the present owners?

Mr. Marsh: My hon. Friend misunderstands the point. These people will be technocrats. They are not people coming in with their heart in the right place a couple of times a week to make the odd comment about the steel industry. They will be specific, functional, qualified directors for a straight functional job. I do not understand where the incomes policy comes into this. There is nothing in the incomes policy about fixing a rate for a new job. The rates to be paid are not higher than the existing salaries of the people concerned, but lower.

DISMISSAL APPEALS BOARD

11.8 a.m.

Mr. Roy Hughes: I beg to move,
That leave be given to bring in a Bill to require that every worker shall be entitled to receive written notice of impending dismissal; to establish Dismissal Appeals Boards; and for connected purposes.
I have two principal reasons for seeking leave to introduce the Bill. The first is that I consider that arbitrary dismissal is out-of-date and opposed to modern conceptions of good industrial relations. What is more, it can no longer be tolerated by trade unionists in this country.
Secondly, the country is going through a very difficult period economically, and there is a need to boost our export trade. Strikes, however, justified, do not help, and I consider that if a form of dismissals appeals machinery existed a good many strikes could be eliminated. Such machinery would have a threefold beneficial effect. Employees would benefit through a greater sense of security in their employment. Secondly, industrial establishments would benefit through not having their production lines halted from time to time. Thirdly, the country would benefit through an overall improvement in industrial efficiency.
I appreciate that Britain compares favourably with many of its principal competitors in the amount of working days lost through strike action. Nevertheless, if our position relatively speaking can be improved even more, so much the better. It is difficult to get reliable estimates of the number of dismissals which take place, but I am informed that it approaches 1,000 for each working day every year. It is apparent that arbitrary dismissal is no small problem and that a great potential source of injustice exists here.
The Minister of Labour as reported in page 91 of his evidence to the Royal Commission on Trade Unions and Employers' Associations stated that two-fifths of all stoppages and 20 per cent, of days lost through disputes arise out of conflicts about the employment or discharge of workers or other working arrangements rules and discipline.
A number of classic cases can be stated. There was the case of the young lady who was dismissed from her employment

for spending too long in the cloakroom. The strike which resulted from that incident had ramifications which spread throughout large sections of the motor industry. There was the case of a lorry driver who reported to his home base that his brakes had failed. He was nevertheless told to bring the lorry back to the depot. This he refused to do, whereupon he was dismissed. Another case I cite is that of a young clerk employed by a steel company in South Wales who was sacked for distributing union literature during working hours.
Dismissals of this kind are often the result of personal conflicts and of hasty decisions by an employer or his representative. Afterwards the employer has to stick to his decision so that he shall not lose face. In many establishments throughout the country where trade unionism is weak the sack is still the main source of discipline. This is largely the case in small establishments, but even in many large and supposedly modern-thinking companies this code still applies for non-manual white collar workers.
Workers know from bitter experience that once a man is out of a factory it is difficult to obtain justice for him. The need for action is immediate. That is why so many walk-outs take place in industry. This is why I am urging the establishment of dismissal appeal boards throughout the country. A worker would be entitled to receive written notice and, except in cases provided for by the Redundancy Payments Act, 1965, he could appeal to the board against dismissal. Until such time as the appeal had been heard, the worker would remain in work or, in serious cases, he would be regarded as under suspension. The board, when considering its decision, would bear in mind the need to foster good industrial relations to ensure fair and quick treatment for all workers and to ensure that those workers have the right to organise themselves into trade unions.
I appreciate that in many establishments good voluntary agreements on dismissal procedure already exist, but are these sufficient? The answer must be "No", for in many establishments there is no trade union. I agree that all workers should be members of trade unions, but often the threat of dismissal is used to prevent the formation of such


an organisation. The threat of the sack is still a great disincentive to forming a union or to becoming a shop steward. Nevertheless, in establishments where good voluntary agreements exist by agreement a company could apply to the Board for exemption from these statutory schemes.
According to The Times on Monday this week, it appears that the Minister of Labour is now thinking along the lines I have outlined. This is to be welcomed. Our machinery on dismissals is behind the times. For example, Western Germany is way ahead in this matter. Our system seems to be based on the principle that a man is guilty until he is proved innocent. The Bill which I seek leave to introduce would reverse that. I trust that in seeking leave I shall have the full support of the House.

Question put and agreed to.

Bill ordered to be brought in by Mr. Roy Hughes, Mr. Probert, Mr. Clifford Williams, Mr. Edelman, Mr. William Wilson, Mr. Park, Mr. Horner, Mr. Palmer, Mr. Abse, Mr. Edwin Wainwright, Mr. Ellis, and Mr. Hazell.

DISMISSAL APPEALS BOARD

Bill to require that every worker shall be entitled to receive written notice of impending dismissal; to establish Dismissal Appeals Boards; and for connected purposes, presented accordingly and read the First time; to be read a Second time upon Friday 14th April and to be printed. [Bill 211.]

POST OFFICE

11.17 a.m.

The Postmaster-General (Mr. Edward Short): I beg to move:
That the Postmaster-General be authorised, as provided for in section 5 of the Post Office Act 1961, to make payments out of the Post Office Fund in the financial year ending with the 31st March 1968.
This is an occasion in the year when I come to the House in my rôle as company chairman of one of the biggest commercial organisations in the country. It is my task to report to the House on the achievements of the Post Office in the financial year now coming to an end, and to outline prospects for the year to come. Like any other company chairman, I should like to be able to report substantial profits, a buoyant return on capital, and a dividend of even better service for the coming year. However, during the past year the return on capital was, for a number of reasons, not so good as we would have wished, and service, while generally improving, still leaves some room for improvement in a number of places.
We have earned 7·8 per cent. overall on capital. This is only a little below our target of 8 per cent., but the predicted return on capital for 1967–68 at 7·4 per cent. leaves no room for complacency. I shall describe some of the steps we are taking to improve the productivity of both sides of our business. Over the whole five years—the target was fixed for five years under the Conservative Government—we will have fallen short of 8 per cent. return on capital on the postal side, although not on the telecommunications side. We fell short on the postal side mainly because the increases in tariffs needed to make good shortfalls in the first two years of the five-year period were rejected by the Government of the day. This means that during this five-year period the Post Office will have generated a fair amount of its own capital requirements.
When any business organisation finds that its profit or return on capital is falling, there are three things that it can do: it can put up its prices; it can reduce the quality or quantity of the product or service it sells; or it can increase its own internal efficiency and productivity. When one is operating a


monopoly like the Post Office, it is only too easy to put up prices or reduce the quality of the service, for the customer is captive and cannot go elsewhere for his stamps, postal orders or telephone calls. In a Parliamentary democracy there is also a temptation on the other hand, to maintain the same service at the same prices through fear of unpopularity and thereby driving the service into the red by selling below cost.
The course which I propose to adopt is the third, that of improving internal efficiency, and I intend to show later in my speech what measures the Post Office now has in hand to do just this. I do not want to raise any false hopes that I will be able to hold prices down indefinitely—I am no magician—but one thing I promise: there will be no general tariff increase until I am absolutely satisfied that the Post Office machine is running as efficiently and as profitably as possible. But before going further I would like to say a word about the longer-term financial outlook of posts and telecommunications in turn.
The main characteristic of the postal service is that it is highly labour intensive. This means that it is particularly vulnerable to wage inflation. By contrast, when wages are kept in check, as they have been during the past nine months, the postal service is given welcome respite.
The great difficulty confronting posts is that a very large part of the work offers little or no scope for increased mechanisation. In fact, about 40 per cent. of postal costs are incurred in collecting and delivering mail. We just cannot mechanise the postman who walks up the garden path every morning. Thus the postal side of our business will retain, though to a decreasing degree, a built-in sensitivity to wage inflation. It is also likely to continue to suffer from recurrent shortages of labour in the Midlands and the South-East—though the Government's policy of redeployment has brought a welcomed improvement in this situation, although not in all areas and certainly not in the South-East.
This rather difficult long-term prospect is not altered by the fact that posts will be making a profit of £4 million this year and are likely to do so next year. Indeed, when considered in relation to income and expenditure of about £340

million, this profit is not very great at all. Of course, posts, like other parts of the Post Office business, are affected by our obligation to provide a basic service throughout the country at common tariffs. In many rural areas the cost of delivering a letter far exceeds the 4d. which we charge for it. This to a large extent explains the fact that the profit margin is little more than 1 per cent. of turnover. I shall say something in a moment about the steps we are taking to improve the profitability of the postal side of our business.
On the telecommunications side the problems are very different. Here, too, there is a large labour force, but the scope for improving the design, performance and profitability of the capital equipment which lies at the heart of the service is very great indeed. However, good equipment and good labour techniques can be prevented from producing a good financial performance if they are not accompanied by sound pricing policy. At the moment our price structure is grossly unbalanced. It is this more than any other factor which is casting a blight on the telephone service's financial performance.
The nub of the problem, this imbalance, is that the inland telephone service has been carried for years on the profitability of trunk calls. Local calls and business and residential rentals are all running at a loss and, if present charges remain unchanged, they will continue to do so. The effect of this tariff pattern is that, when trunk traffic is buoyant, the overall profit is large enough to achieve our target return on capital, despite the losing services. When the rate of trunk growth falls, the performance of the entire service reflects this, and we know from sad experience that trunk traffic is particularly sensitive to any reduction in the level of business activity. In the business world the first economies are usually on trunk calls. This means that the telephone service has too many eggs in one basket—a very foolish position to be in.
What we must do is to put our tariff structure on to a sound footing to correct the imbalance, so that every service pays its way. We made a move in this direction at the beginning of this year by increasing call office charges while reducing the cost of cheap-rate trunk calls.


A further major operation is required to correct the imbalance at some time in the future. I do not think we can really get the Post Office finances on a sound footing until this very large operation is carried out fully.
Now I would like to turn to some of the ways in which we are making a determined onslaught to step up our efficiency and our productivity. The telephone side offers some excellent examples.
STD is now available on three-quarters of the telephones in this country. We are also replacing the remaining local manual exchanges. By the end of this year, fewer than 3 per cent, of subscribers will be connected to manual exchanges, and there will be none at all after 1970–71. If it were not for this automation programme, the cost of providing telephone operator services would increase by £4 million in each of the next two years; and the cost to the public of making calls in the old way would be some £12 million higher each year.
We are also widening the scope of the existing S.T.D. system by developing what is known as the transit network. At present, subscribers on S.T.D. exchanges can dial on average only about 80 per cent. of their calls; the rest have to go via the operator. To enable them ultimately to dial all the exchanges in the country, we are planning to install 36 special trunk exchanges throughout the country at a cost of £6½ million. A new network of trunk lines will join these exchanges. We have ordered the first of these, and savings will start to build up from 1968–69 onwards as the number of calls which have to be handled by operators is cut down. When the transit system is completed in 1972, it will produce a saving of about £12 million a year, and the public will gain from having full access to the cheaper and quicker S.T.D. service.
We are also making wide-ranging changes in exchanges to improve efficiency and reduce costs in telephone operating. The turnover of staff—especially of young girl telephonists leaving to marry or for other jobs—is very high, and training is a significant item in the operating budget. By using programmed learning techniques, which cut

the period of training by about a sixth and which we are pioneering with full staff co-operation, we hope to save up to £1 million per year. We are also starting to simplify some time-honoured procedures in handling calls, with a saving of a further £1 million per year.
In the longer term, cordless switchboards, which are now gradually coming into service to replace the older "plug and cords" switchboards in public telephone exchanges, will reduce the time taken to connect calls via the operator by up to 25 per cent. Clerical processes are also being reviewed by O. & M. techniques and savings so far are about £½ million a year.
On the engineering side of the telecommunications business there are also striking examples of the progress we are making. We have successfully introduced the first production electronic telephone exchange, which I opened at Amber-gate in Derbyshire in December, and will be installing another 30 or so this year, to come into service in 1968. This type of equipment is intrinsically more reliable than the old electromechanical system and its high switching speeds offer a whole new range of facilities and advantages. Yet much less maintenance will be required, and thus we will significantly reduce demands on our skilled manpower, and, at the same time, we will lower running costs.
On the transmission side, more and larger capacity coaxial cables are being used. The capacity of radio links too has been increased. By measures such as these, the cost of each added trunk circuit has been reduced by about one third since 1964.
Pulse code modulation systems, which will increase the capacity of other existing short-distance cables, will be put into regular service within one year from now, and we are starting an experiment soon which should lead to further reductions in the cost of these shorter lines.
We are putting considerable emphasis on improving the maintenance of existing plant, and early detection of faults. For example, in exchanges we are providing more automatic testing plant, and plan to introduce new equipment that will detect failures automatically and take the line out of service.
In co-operation with industry, we are taking advantage of value engineering techniques to cut the cost of equipment. The application of these techniques to the telephone instrument has enabled us to reduce the cost of its manufacture by 10 per cent. For example, we have discovered that in the dial we can reduce the number of parts from 101 to 30, and reduce the number of screws from 30 to three.
We are also making great strides in putting our engineering manpower to better use, so much so that we now confidently expect to be able to increase the size of the telephone system by about 50 per cent. in the next five years or so, with little or no growth in our engineering labour force. This will be the measure of our success. It says much for the sense of responsibility of the unions that these improvements in productivity have been made possible with the fullest co-operation of the staff involved.
Some of these improvements in the telecommunications and engineering fields are the fruits of our research and development groups. Others are the work of the efficiency groups we have set up to run the rule over the whole of our activities. At the local level, efficiency is being stimulated by service and productivity improvement plans which will, among other things, set new and better quality of service targets for individual telephone exchanges.
Similarly, the postal side offers many opportunities for increased productivity though—as I have said—it will remain labour intensive to a considerable degree. Our attack on this problem is two-fold: to mechanise wherever we can with profit and elsewhere to make an intensive drive to improve management and operating methods so that each man employed can make a maximum contribution to output.
Mechanisation of postal processes has proved difficult. But we have set on foot an ambitious programme, which makes us a world leader in this field.
We have not sought to mechanise indiscriminately, but only where it will show profit. Schemes so far introduced have shown a return on capital of more than 10 per cent. The most dramatic changes in mail handling are, however, just starting with the new coding desks

and automatic letter sorting machines which I have described to the House before. These machines, which code-mark and sort letters with minimum human processing, are now going through their final trials at Norwich, which this year will become the first fully automated sorting office in the country. If all goes well we shall embark on a programme of equipping our 75 largest offices with these machines.
We plant to spend £45 million in the next 10 years on sorting office mechanisation and more than half will be invested in the new coding and automatic letter sorting machines. We expect this investment to produce a return of 25 per cent. and substantial economies in manpower. By the end of the 1970s, upwards of 75 per cent. of letter mail and practically all parcel mail will be sorted mechanically.
We are also increasing the number of staff trained in the latest management techniques of work study and operational research. By improving operating practice, providing better performance measurement and control, and generally raising management efficiency we are confident that we can significantly improve productivity.
These activities apply to the Post Office counters as well as to the mail service. Here the task is to adjust our counter staffing to local customer needs, so as to avoid excessive queueing on the one hand and waste of staff time on the other.
To bring all these efforts together at the effective management level and ensure that they pay off in the field, we have introduced a system of postal operations improvement plans, and we are extending arrangements under which managers are called upon to set themselves challenging targets for the period ahead. This will provide stimulus for individual managers. They will be assessed in the light of their achievements, and their future advancement determined accordingly.
These measures will be complemented by an overhaul of the pattern of local postal administration. We have in hand a plan for the rationalisation of the postal administrative centres throughout the country which I hope will be completed and implemented within the next year or two because so often the present pattern was laid down 50, 60 or 70 years ago.
As on the telecommunications side, I should like to pay tribute to the splendid co-operation we have received from the unions in all our efforts to improve productivity.
I will now comment on our use of computers. About £4 million worth of them are already installed and working. Others, worth £3 million, are on order. By 1971, we shall have 20 large, modern computers in operation.
One of the biggest computer jobs we have tackled so far is telephone accounting. Already some 9 million bills a year are produced by computer for customers in London. In about two years' time, when this system will have been developed to serve the rest of the country, we expect it to save over 2,500 clerical staff.

Miss J. M. Quennell: Could the right hon. Gentleman tell the House about the nature of these computers? For example, are they British-built or imported computers?

Mr. Short: The Assistant Postmaster-General, who will be replying to the debate, will give the hon. Lady that information. We are short of time for this debate and I do not want to delay the House by giving information which my hon. Friend may need to detail later.
Other computer projects, covering a wide range of tasks, should bring total savings in posts and telecommunications to over 12,000 staff in the next few years, and I doubt whether any other concern in the country could do better than that.
But we are not proposing to use computers solely to save staff, essential though that is. We shall be using them more and more to help manage our resources of lines and exchange equipment, to plan our postal motor transport services and to improve the circulation of mail across the country. The National Giro of course will be fully computerised from the start. The Post Office is, and intends to stay, in the forefront of developments in computer technology and its practical application. Moreover, it is well fitted to do this since it numbers among its staff one of the biggest civil forces of systems analysts and programmers in the world.
Before closing, I should like to make an announcement about something of

great importance in the context of improving Post Office efficiency which has been my theme this morning. It concerns the top organisation of the Post Office.
About 10 days ago I presented to Parliament a White Paper on the prospects for 1967–68, in which I said that the traditional Civil Service pattern or organisation is not best suited to what is in effect the biggest service industry in the country.
At present we have a Deputy Director General for Posts and another for Telecommunications. Their titles define their responsibilities but they do not have full authority to match these responsibilities. I am making a number of changes to put this right and the first of these will be made next month on the retirement, due to ill-health, of the Engineer-in-Chief. I shall then introduce a new organisation making it clear where, under myself and the Deputy Chairman, responsibilities lie for engineering policy.
The two Deputy Directors General will become Managing Directors, one for Posts and the other for Telecommunications. The post of Engineer-in-Chief will be replaced by one for a Senior Director of Engineering, who will not be directly answerable to the Board although he will be on the Board. He will be responsible to the Managing Director (Posts) for postal engineering matters and to the Managing Director (Telecommunications) for all telecommunication engineering matters. A Senior Director of Telecommunications will be responsible to the Managing Director for the non-engineering aspect of internal and external telecommunications.
These important changes will be followed by others affecting the Post Office from top to bottom over the next 18 months. In dividing up the common service departments, the guiding principle will be to give each of the two businesses its own supporting services where this can be done without unnecessary and costly duplication. In some cases, the common services will be completely split between the two businesses and come under the two Managing Directors. In others, for example in the case of finance, a small central department will remain under the Board. The present all-purpose regional organisation will in most cases be ended, and will be split into separate Postal and Telecommunications regions. The object


of all these changes will be to enable managerial drive to make itself felt throughout the whole structure from top to bottom, from Managing Director down to field level.
These changes will begin the process of creating a more dynamic coherent and purposeful management structure in the Post Office. The object will be to group people together according to the tasks to be done rather than the grades and hierarchies to which they belong, to place the process of decision-making closer to the point of implementation and to make that process quicker and surer in operation. It will speed the drive to give better service and improved productivity.

Mr. Stratton Mills: Could the Postmaster-General say whether these very important structural management changes follow the exact pattern of the McKinsey Report?

Mr. Short: There is no McKinsey Report. McKinsey's, who have been working with us for some time and should end their association at the end of the month, have been reporting to me regularly, but there is no such thing as a McKinsey Report. The changes broadly follow McKinsey's recommendations, but not exactly by any means.
I hope that all the major managerial changes will have taken place by the spring or early summer of 1969.
I do not want to leave the House with the impression that Post Office management is bad. This is very far from being the case. Nor would I like it to be thought that this reorganisation is a reflection on Post Office engineers. As I said recently, they are a very talented group of people and I believe they are one of the best groups of engineers in the world. There is no reflection on them at all. It is simply that in a growing industry like telecommunications, with its dependence on technological advance, the place of engineers in the Post Office is assured and will undoubtedly grow, but it must be made clear that they are part of an organisation which is responsible to the Managing Directors and, through them, to me.
Because the Post Office is still part of the Civil Service, and because I must not anticipate Parliament's approval of the proposed change in status of the Post Office, I am making these changes within

the context of the Civil Service, and they have been agreed by my right hon. Friend the Prime Minister. No doubt they are not the ultimate organisation which the Corporation will want, but I hope that they will be regarded by the House as a very valuable move towards it.
I am quite sure that, with a modernised management structure, and with the continued efforts I have been describing to achieve greater efficiency and greater productivity, the Post Office will be able to give an even better service to the country in the years to come.

11.45 a.m.

Mr. Paul Bryan: Last year, this Motion was moved on the eve of greater things, on the eve of battle when everything was in a rush. The White Paper on Post Office prospects had been published literally only minutes before the debate, so we did not expect a great discussion. This debate has in years gone by varied in its length from five hours to five minutes, and I suggest that as this is a crucial year and as we have this morning a somewhat longer amount of time we should have a rather longer debate. I am glad that the Postmaster-General has used this occasion to give us a very full account. We are very grateful for all the information given to us, and before the debate is through we shall try to extract more.
It is of immense interest to everyone, and especially for those working for the Post Office, to have some idea of the Parliamentary programme in relation to the Department. We have had the White Paper on prospects, and a week or two ago we had the Report of the Select Committee on Nationalised Industries. We were told that we would have a White Paper on future organisation before Easter. We will presumably have a debate on that, coupled, no doubt, with the Report of the Select Committee some time after Easter. I do not ask for exact dates, I seek general guidance only.
After that, will legislation be expected in the autumn? If so, I assume that it will be fairly long and complicated. Does the right hon. Gentleman see it going through the autumn, with the Queen's Consent in the New Year, and vesting date—when? These things are of some importance, especially to those in the industry because they need to know


where they are and how long they will have to wait before knowing their fate. I appreciate that every effort is being made and that staff relations in the Post Office are good, but this is inevitably a period of great worry for everybody working in it, in whatever grade they may be.
A period of takeover, whether it be of this sort or a business takeover, cannot help but be a time of worry. There is bound to be worry about redundancy and the changes that will take place. I agree that fears about redundancy should not be very great, from what we know of staff shortages, but in almost every other aspect those working for the Post Office will have misgivings and fears. The Post Office has published pamphlets giving employees a certain amount of information, but the uncertainty is still there, and there cannot be too much reassurance given to the staff during this handover period. The Assistant Postmaster-General might well use this present occasion personally to repeat the reassurances already given, and relieve any remaining doubts there may be.
I have been in touch with various Post Office employees and I know that they would like reassurance as to their exact position up to vesting date. They would like to know when vesting day will be. The Post Office staff continue to be civil servants until then. What rights have they to recourse to the Civil Service Arbitration Tribunal? We are told that negotiations on conditions of service will start after the Royal Assent has been received, and that is why the date of that Royal Assent is very important to these people. What is important to them is to know exactly what is happening now. Consultations are obviously taking place. Is it possible to give month-to-month information on how the consultations are going, or are they so private that that cannot be done?
I say that because I have received a letter, which is probably representative, which says this:
… rumours … are rife predicting loss of annual leave, normal service extended to 65 years of age, telescoping of grades, etc., and the most disturbing aspect, was that in common with
the official of the union in question
he seemed prepared to accept these retrograde measures, his only reassurance being that we

could be sure that such loss of conditions of service would be at a price.
We are deeply concerned that our own national officers should talk in this way and yet feel unable to disclose anything of the negotiations now in hand. The more so since, as I have already said, the changes proposed have not been voted on in Parliament, nor have we, the staff, had any opportunity to approve or otherwise.
I obviously do not comment on how justified these worries are. They are, however, the type of worries which are being voiced, because this is not the only letter I have received. It would be worth while for the Postmaster-General to use this occasion to try to put these worries at rest.
I have been asked this question on the matter of Civil Service status. If a Post Office employee wishes, when the time comes, not to lose his Civil Service status but to move to another branch of the Civil Service, will he have the opportunity to do so? There is in the Civil Service a certain indefinable sense of privilege which is much valued.
It is important to know how security of tenure will compare with present conditions. There is a feeling that in the Civil Service there is an extremely sound basis of security of tenure. Under the new system will the basis be as reassuring?
I have been asked whether superannuation will be contributory or noncontributory. If contributory, a pay rise would presumably be implied. If so, what about the freeze? People are clearly frightened of how pay will be adjusted in conditions of freeze.
Is it too early to start talking in any detail about grading structure and annual leave'? Will there be a new basis for the leave allowance for grades fixed in accordance with Civil Service grades? I do not expect detailed replies to these questions. I am listing the matters which have been brought to my attention and which seem worth airing and getting assurances on, if possible.
By the very nature of events people are obviously worried. I do not know from the Report whether this is a tactless time to start talking about innovations. The Report of the Select Committee shows how important it is for the Post Office to try to get more part-time workers and women workers if they can be accepted by the unions. The emphasis on the problems of peak work makes this industry ideal


for part-time work. Part-time work is ideal for the Post Office. It is an ideal outlet for many thousands of good people who need more money and who want part-time work.
One of the tragedies of the S.E.T. is that it hits part-time work, which is the most efficient work there can be. I dare say there are many lazy people doing full-time work, but there are very few lazy people doing part-time work. Part-time workers have only gone there because they want to work and earn money. While great changes which have to be made are being made, if we could come in on that tack it would be of great value to the Post Office.
I should like some clarification on one statement on the Report of the Select Committee which I do not understand. The Report states that Post Office recruitment has been handicapped by the Civil Service framework within which agreements have to be made.
There is so much in the Report of the Select Committee that obviously this is not the occasion to debate it. The Report will be our bible and work of reference in the coming debates, especially that on the White Paper. As the Chairman of the Select Committee is here, may I say how much I admire the product of his Committee. I am sure that all hon. Members are grateful to the hon. Gentleman and to his Committee for producing it at such an appropriate time. If I have any complaint, it is certainly not a complaint about the working of the Committee or about the personnel who took part in that work. My complaint would be about the nature of the Report. Apart from the Chairman with his professional background, on this occasion the investigators have been too much like us. They seem often to have gone through the circle of the same arguments; they have seen the same difficulties; they have come to the same conclusions. Perhaps this is because those are the only conclusions which it is possible to come to. There is not in the Report the breath of fresh air or the new look that I had hoped would be there. There is, perhaps, a new look, but what we want is a look from a new angle.
The Government made a wise decision in appointing McKinsey's in the early days. I am sure that the Post Office must have been a treasure trove for this firm,

treasure comparable with the North Sea findings. The Post Office as it stands must be the answer to a consultant's prayer. It is a super-massive organisation; it has a turnover of £700 million; it has an annual capital expenditure of £200 million; it has 400,000 employees. The Post Office has gone peacefully along for 400 years unstimulated by competition, as the Postmaster-General has wisely pointed out, and unfertilised by talent from outside the Post Office until the appointment of Mr. Wall. It is a labour-intensive industry with good industrial relations. At the moment when the firm started work it had been almost agreed that a structural change was scheduled and ready. McKinsey's could hardly have come in on a better scene. Any firm of consultants, especially a firm of such a calibre, could not but expect to make a pretty startling impact.
So far we have merely known that McKinsey's are there. We have only in a half-hearted way asked for reports on their progress, because we know that consultants take their time. We know that from the bills they send in. Results are not achieved overnight. This is not a routine investigation to keep the Post Office up to date. It is an investigation which should have a tremendous impact and influence on the future shape of the Department.
So far we have said that it is impossible to have a report from McKinseys which is publishable. However, it would be interesting to see some before and after examples in some detail. This would reassure people that things are happening in the Post Office on a bigger scale than a normal improvement, although that in itself would be good. The Report of the Select Committee occasionally indicates areas where McKinseys should be of great help. It also contains traces of where obviously the firm appears to have had some effect.
For instance, it appears from page 23 of the Report that the Post Office statistics for postal services are not particularly good. This is serious. With an organisation as large as this, if a statistic is only a small fraction of a per cent. out it will be multiplied to such a degree that the fault will in the end become huge and costly. I imagine that on this matter a consultant firm like McKinseys can be very effective.
The whole chapter on tariff policy seems to show up what I would call by modern standards a pretty rough-and-ready costing. Proceeding along the route of rationalisation which the Postmaster-General is now taking, a system of costing is desired in which there is great confidence. We want to be right up to the modern methods. We have all studied and followed the progress of mechanisation in the Post Office and we are all interested in the experiments, and so on. In modern business, the thing that is getting it ahead, and which is enabling it to make progress, just as fast as mechanisation and computerisation, is far better planning of the performance of the human being. The measurement of and reward for human performance is something which has developed tremendously in business over the last five years.
I welcome the progress that one sees in this Report, especially on page 149, where we read:
In addition the McKinsey consultants have recommended a new system of staff assessment on the postal side based on performance and financial results. The particular points to which the consultants have drawn attention are cost control and the identification of improvement oportunities.
That seems to me to be very important indeed. The next paragraph says:
The existing system of staff appraisal, which has been developed in consultation with the staff sides, hinges on personal attributes rather than the specific achievements of staff. However, recent proposals, including those made by McKinseys will lead to a shift of emphasis here which will be helped by the use of performance targets, the forming of local improvement plans, and the periodic definition of job objectives.
That is highly commendable and is the sort of way that we should be going.
I had always thought until the last few years that industry had been somewhat backward in this respect. I used to think that the Army did better at this. In the Army one never did anything before one knew what the object was and before one had all the information. But in the more backward firms of industry, people are far from clear about what are the objects and targets. I am glad to see this sort of tendency coming into the management side.
In the Report of the Select Committee we are told that the Industrial Reorganisation Corporation will look into the

question of relations between the telecommunications side and the industry. Perhaps we could hear a little more about that.
I should like to finish by firing a few questions from the Report of the Postmaster-General. All these Questions will be on the postal side. One of my hon. Friends, if he catches your eye, Mr. Speaker, will be talking about the telecommunications side.
On the question of the conveyance of mails, I was impressed, on reading the Report, by the immense dependence on British Railways. Apparently 75 per per cent. of all letters and 91 per cent. of all parcels go by British Railways. Of this huge bill of £22 million—nearest account to that is about £1 million for the airways—the huge preponderance of costs falls on British Railways.
I should like to know what effect the reorganisation of the railways has had. In other words, has the reduction of the linage over the last few years made a great difference to the Post Office, or not? What has been the effect of the improvement of some of the lines, such as the electrification of the service to Manchester? Has it taken a lot of mail off the airways and on to the railways, like it has with passengers?
Can the Assistant Postmaster-General tell us a little more about the experiment in East Anglia, which is referred to in page 25 of the Report. It says:
As an experiment, the Post Office are using their own vehicles for carrying parcels to East Anglia. The Post Office claim that this has proved a better and cheaper service and that costs are lower than rail costs under the pre-January, 1965, Parcel Post contract. The experiment has also enabled the Post Office to have the railways national conveyance charges reduced by £3 million to £4 million a year. Elsewhere road services are used mainly for local distribution and for routes where there are no suitable rail services.
Does this mean that where rail services were available an experiment was tried using the Post Office's own vehicles and that a great reduction or saving resulted? If that is so, can the Assistant Postmaster-General tell us whether further experiments will take place? Can he also tell us whether it shows that British Railways were, in fact, overcharging in the past? Because of this bargaining power of being able to use one's own vehicles, it would appear that it was found possible to force


the British Railways to reduce their charges.
Another very alarming thing that comes out of this chapter on conveyance of mails is, of course, the standard of service provided by British Railways. I am bound to say that this is astonishing, because it says:
Although the Post Office expressed reasonable satisfaction"—
I am surprised that it did—
… with the service provided by British Railways for letter traffic, they were not satisfied with the punctuality of mail trains. In January to June, 1966, only 34 per cent. of travelling post offices ran to schedule and 19 per cent. were more than 20 minutes late.
That seems incredibly serious—
The consequences of such delays are serious because the letter service depends upon a 'closely integrated network' of mail trains and failure to make connections on time not only dislocates the service but also causes mail to miss a delivery.
It goes on to say:
While claiming that the majority of mail trains had a good punctuality record the British Railways' witnesses admitted that the crucial service between Euston and Glasgow was 'most unsatisfactory.' This particular train was on time at Glasgow on only 10 out of 150 journeys between January and June, 1966;
I wonder whether the Assistant Postmaster-General could tell us how long this situation has been going on, and what sort of improvements are taking place.
It goes on to say:
There was no single cause of this unpuctuality, but British Railways hope that electrification and re-routing will produce some improvement by March, 1967.
March was the month in which we debated this matter. I wonder whether the Assistant Postmaster-General can give us details of any report that has arrived on his desk which might give us better news.
On the quality of service, on page 30 we are told that this was deteriorating.
It says:
The Post Office admitted to your Committtee in February, 1966 that the general quality of services was deteriorating.
On the other hand, the White Paper entitled "Post Office Prospects," says:
Some improvement has been made over the last twelve months and further progress in this direction is one of the aims of the Post Office for Quality and Reliability year.'
I take it that we are in the "Quality and Reliability Year". Did it start at the

beginning of the year, on 5th April, or when? Perhaps we could have that small piece of information.
On the question of mechanisation, what the Postmaster-General had to say about Norwich was extremely interesting. I believe that the test was due to end in February, 1967, which is now. Do I gather from what the Postmaster-General said that this test has proved a success? Is there a report on this matter, which might be of interest to hon. Members? It seems to be a technical matter, but it might be of interest to read. If it is a success, is it likely to be multiplied in accordance with the money to be spent?
Incidentally, as a Yorkshire Member, may I ask a question which is important to quite a big lump of Yorkshire? It was said that a sorting office was to be established above Leeds City station, or that this was being considered. Has this been built?
Other hon. Members will want to speak, and we are not treating this as a debate on the Report of the Select Committee, but more as a preparatory and probing operation to clear the deck for the big debate which is coming, on the results of which so much will depend, both in respect of postal services to the public and in respect of the lives and prospects of the 400,000 good people who give us these services.

12.11 p.m.

Mr. Ian Mikardo: I desire first to express my thanks to the hon. Member for Howden (Mr. Bryan) for the most kindly references he made to the work and report of the Select Committee on Nationalised Industries, and I am sure that my gratitude and pleasure will he shared by my fellow members of the Committee.
As the hon. Gentleman said, this is not an occasion on which we ought to debate that Report. We ought to have a go at it later when we have also got my right hon. Friend's White Paper on changes proposed in the structure.
The hon. Gentleman criticised the Report for being of a piece with our own work without a real breath of fresh air. Far from resenting that criticism, I think that the hon. Gentleman is right, and, if I may say so without sounding horribly condescending, which I do not want to


be, I thought that it was a very shrewd observation and analysis on his part.
Being wise after the event, if we were having another go at the job, I think we might look at fewer subjects in much greater depth, rather than at so many subjects in less depth. The great advantage of a consultant, which the hon. Gentleman hinted at more than once, is that he comes into an organisation with a fresh mind and he can see the wood for the trees. The chaps on the job, who have the responsibility of day-to-day decisions, with three telephones on their desks all liable to ring at any minute, are tied down by the trees. The consultant, without any obligation for day-to-day decisions, comes in without having to poke down to every bit of detail, and can take a broader view because he is not cluttered up with details. I feel that if we were doing this job again we might avoid climbing up so many trees as we did on this occasion, and might therefore get a clearer overall picture of the wood.
I make only one observation on the suggestions made by my right hon. Friend for changes in the management structure. My right hon. Friend has had to do an extremely difficult job, because in creating a management structure for an organisation like the Post Office, or in changing such a structure to meet such greatly changed circumstances as are created by the change in status as well as all the other changes which one wants to make on their merits, there are no absolutely right answers.
Every method which my right hon. Friend could have brought forward would have had some advantages over all the others, and some disadvantages compared with all the others. It is a very delicate decision to make, and it becomes even more delicate in an organisation which is running two very different industries, one which is highly capital-intensive, and one which is highly labour-intensive, one which is up to the very last minute of our technological advance, and one whose methods have not changed enormously for a century or so.
There was one school of thought which considered that we ought to divide the two things into two separate corporations. I think that my right hon. Friend's decision not to take that view was the

right one, and that a good deal would have been lost by that totality of separation. At the same time, I think that this division of operational responsibility and operational accountability, the unblurring of some of the blurred frontiers between the two parts of the organisation, which my right hon. Friend has announced this morning is altogether to the good.
It struck me, as it manifestly struck my right hon. Friend, that the situation of engineering without direct responsibility to those who had to run and show a profit on the sevices for which the engineering was being supplied was altogether too hazy, and I am sure that my right hon. Friend is right.
I think that my right hon. Friend will have some administrative trouble, no more than that, in taking that degree of separation down to the regional level where the intertwining becomes very complicated indeed, and where it really will be impossible to separate the Siamese twins without supplying more blood and bones, in other words, without increasing the overheads by adding more executive staff.
On balance, I think my own predilection would have been not to carry the separation too far along at that level, but I concede that it is possible to take the other view, and that there may be very little in it as between the two views.
I look forward to a further and better occasion for going into some of these matters in detail, and perhaps I might content myself with saying that I am sure that what my hon. Friend said this morning will be warmly welcomed by those who are to have the job of running this great enterprise and improving it even beyond its present standards which, generally speaking, are by no means too bad.

12.17 p.m.

Miss J. M. Quennell: I agree with the hon. Member for Poplar (Mr. Mikardo) in what he said about the speech of my hon. Friend the Member for Howden (Mr. Bryan). I think it is probably true that if one can get away from the pressure of constant management one can get a clearer view and take time to think clearly about the problems confronting interrelated a structure as the Post Office.
I shall not pursue the hon. Gentleman's argument too far, because when he was talking about separating the Siamese twins, and supplying them with more blood and bones, I was a little worried about the biological implications of pursuing the matter very much further.
I think that this debate is of the greatest interest, because the Post Office finds itself in a curious position. On the one hand, it is reaching for the stars. Advances in telecommunications and in satellite communications present a story of progress and advance in modern techniques. On the other hand, we have to face the fact that the British public, the average post office user, the chap who uses his telephone either in his office or at home, the man who posts a letter either for business reasons or for purely domestic ones, are becoming more and more critical of the service which they are getting.
It may have something to do with the fact that the Report and Accounts which we are discussing are for the year ended 31st March, 1966, and here we are debating them on 15th March, 1967. Therefore, to a certain extent, this debate is probably out of date and hon. Members' suggestions and inquiries will probably be out of date and might already have been covered in some other sphere.
My right hon. Friend raised the important question of the dilemma of the Post Office's dependence on British Railways. The Report makes it clear that British Railways is not offering the Post Office a service which is all that could be wished. The Postmaster-General is accountable to this House and we can question him about the Post Office, but we cannot call here and question the Chairman of British Railways. Therefore, our dilemma is that we cannot find out from British Railways why it cannot offer the Post Office a more reliable service.
Running throughout the Report are references to staff shortages and the difficulties of getting trained and highly qualified staff. Before I entered the House—to some extent this is still the case—I was fairly closely involved in technical education. One of the colleges with which I was connected ran courses in telecommunications for Post Office staff.
Appendix 8 of the Report gives staff numbers by class, amounting to nearly

400,000 of one grade or another, and the constant references in the Report to shortage of trained and qualified personnel and the difficulties of obtaining them led me to hope to find a reference to some improvement in the training schemes available to the Post Office. There is implicit in these references to the difficulties an admission that the present system of intake is inadequate. It might, therefore, be advisable for the Post Office to consider providing its own training college.
The last three entries in Appendix 8, leaving out miscellaneous staff, relate to professional engineers, scientific and technical staff, supervising engineers and other engineering grades—totalling 105,209 engineers of one sort or another. In the new technological age, personnel will need constant refresher courses. With that large number of existing personnel and the need to train and retrain, the Post Office should be able to maintain a viable training establishment of its own to help meet the need. Two other classes, in this Appendix, postal and telegraph officers and telegraph and radio operators, will also need considerable training initially and retraining with modern advances in technique.
Another inadequacy of the service referred to in the Report is its inability to meet the demand for telephones. In the Introduction, we read:
Much has been achieved, but the service is still not as good as it should be and will be. Demands for telephone connections cannot he met everywhere as they arise, mainly because of shortages of exchange equipment.
With our much more mobile society, people have moved about the country and the Post Office has been taken unawares that a large demand for additional telephonic equipment has grown up, particularly in the South of England. This could hardly have been predicted by the Post Office, since even the most critical subscriber does not expect the Postmaster-General to be clairvoyant as well as the "chairman" of a big public company.
But there should be some way of detecting much earlier the movements of population, so that the Post Office is not caught unawares. Some rudimentary liaison machinery was established some years ago with the planning authorities in the South of England, but this does not appear to have been enough. Another


weapon which the Post Office could use to fight this problem is the Registrar-General's returns, which will show a useful pattern of population movements, as he is now taking spot censuses as well as the 10-year census.
If there is a large repatriation of Service men to this country—according to the Defence White Paper, about 20,000 men and 6,000 families will be involved—will the Post Office or the Services be responsible for the necessary telecommunications? If it is the Post Office, there will shortly be a far bigger call on its provision than we had thought—

Mr. James Dance: All these married families coming back will represent another problem, in that they will need some telephone communication. Will they get it? We should want to know this, too.

Miss Quennell: This is another aspect of the problem; my hon. Friend is absolutely right. About 6,000 families are to come back, according to the Defence Estimates, and about £20 million has been provided for the purchase of private houses, caravans and mobile homes. Already, the Army is buying—certainly in my constituency—large numbers of private development houses. These problems will be acute if not faced early and a solution found.
I wish that the result of the opinion poll referred to in paragraph 92 could have been published in the Report, as it would have been interesting.
There is another reference on page 37 to the difficulties of obtaining staff, certainly in the Midlands and the South, but there is no reference to the employment of postwomen. One wonders whether it would not be possible to alleviate the shortages of postmen by at least considering the employment of post-women. I cannot find a reference to postwomen being employed. I seem to recall having seen postwomen and—

It being half-past Twelve o'clock, the debate stood adjourned.

Debate to be resumed Tomorrow.

PLANNING LEVY (PETERBOROUGH)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. McBride.]

12.30 p.m.

Sir Harmar Nicholls: I have a two-fold aim in initiating this debate. The first is to ensure justice for several of my constituents and the second is to prevent the Government from being guilty, I hope unwittingly, of a grievous breach of good faith in their dealings with a local authority which has been prevailed upon to co-operate with them in alleviating a national problem.
The history of the matter is easily told. The Government and the L.C.C. wanted provincial areas to assist in overcoming London's housing shortage by expanding quicker than they would normally have done in order to take London's overspill population and thereby alleviate one of London's greatest problems. Although an established and traditional city, Peterborough, with two other towns, was invited to do this by doubling its size very quickly indeed under the new towns procedure.
There were, and still are, many doubts in many quarters about whether this will be a good thing for Peterborough. However, the scheme was presented by the then Minister of Housing and Local Government in terms which gave the impression that many benefits would flow from the Exchequer to Peterborough if that city co-operated. It was always emphasised that if, in the process of bringing the scheme to fruition, any anomalies arose which would be detrimental to Peterborough and its people, the Government would act with sympathy and speed to try to overcome them. That was the whole atmosphere in which the Government presented their appeal to Peterborough to help when the scheme was first suggested. It was in this atmosphere that Peterborough was prevailed upon to become the guinea pig; and the scheme is now under way.
I must tell the House that, very early on, the Government's good faith is being put to the test and that their first reaction to having to honour their obligation is very disturbing to me in the light of an


anomaly which I wish to put to the Minister today.
In keeping with this expansion under the new towns scheme, an outside consultant was appointed by the Minister to prepare the expansion scheme in detail. That was the right course to take. Having started the process, that was, indeed, the right road to pursue. However, until the full details of the consultant's scheme are available, planning permission has had to be refused by the local planning authority to certain private developers because of the possible risk of these developments cutting across the ultimate overall plan which will be accepted. This has caused considerable hardship to local owners, and that should not be forgotten, although I acknowledge that hardship may be inevitable in some cases.
If one is to have an overall plan that takes some time to reach fruition, it is vital that any separate planning approval which one gives in the meantime should not cut across what the final plan will be. Thus, although this represents a hardship to some of my constituents, that is not the main point to which I draw the Minister's attention, although I hope that he will bear it in mind.
This hardship would be bad enough standing alone, but in the meantime we have had what I can only call the villainous Land Commission being made the law of the land. Under the new arrangements any developer must pay a 40 per cent. levy on increased values arising from any development which has not been approved and actually started before 6th April next. Those who have permission and have started on their schemes in other towns will not have to pay this onerous 40 per cent. levy. Several of my constituents would have been in that position had not a stop been put on their schemes arising from actions which flow entirely from Peterborough's decision to co-operate in the Government's overspill scheme.
If Peterborough had said, "No, we are not prepared to help with your scheme to help London. We will not be good neighbours", these constituents of mine would have submitted their schemes, would have had them approved, there would not have been a consultant's overall scheme for which they must wait, and they would have had their developments under way. They would not, therefore,

have to pay the 40 per cent. levy which arises out of the Land Commission legislation. Now, because they cannot get their schemes approved, they cannot make a start before 6th April and they must pay the 40 per cent. levy—that is, unless I can persuade the Minister to grant them an exemption, as he can under Section 63 of the Act.
If the Minister, in considering this case, does not take steps to grant this exemption, then the present state of affairs will be iniquitous and I prophesy that it may well endanger the whole expansion scheme. I say this because, without local good will, this risky revolution in Peterborough could not succeed. And if, at this early stage, the Government's protestations about having sympathy in dealing with anomalies are shown to be a sham, all local trust will vanish, and so will the expansion scheme.
From the very beginning, when the expansion idea was first mooted—remembering that it has been undertaken by Peterborough at the request of the Government—there were strong feelings locally on the subject. Many people thought that Peterborough was making a mistake. It was only on the understanding that the anomalies and difficulties which would inevitably arise in such a scheme would receive the sympathetic consideration of the Minister of the day that many local people then agreed with the idea. The undertaking to give sympathetic consideration to any anomalies was virtually a promise when the matter was first put to Peterborough.
Extreme concern about the expansion itself being endangered arises because of the terms of a letter which the Minister of State sent to me on 1st March last after I had put the matter to him privately. I put it to him in terms which I thought would at once alert him to the need to keep the Government's promise to Peterborough, but the terms of his letter are disquieting. He said, in effect, that our fears might well be exaggerated because he gathered that by no means all planning consents were refused.
There is no exaggeration here. To prove it, I will give a few of the cases that are known to me, although they touch only the tip of the iceberg. We have the industrial sites in the Fengate and Padholme Road area of Peterborough. We have the Barrets' valuable corner site


in Long Causeway, in the centre of the town, a valuable site where approval has been held up for at least 12 months. Then there is the site for flats at the corner of Thorpe Road and Thorpe Lea Road. There is another Thorpe Road site for 58 flats. We have had a large development in Bridge Street. I could give many of these examples, but the value of those I have already given is many tens of thousands of pounds. I believe that I have already given sufficient instances to show without wasting the time of the House, that there is no question of exaggeration in making this appeal.
The Minister made a second implication in his letter of 1st March. Though I paraphrase it, it is a true paraphrase, so I can quote it. What the Minister said, in effect, was, "It is just hard luck on your constituents. Morally, the increase in values before 6th April ought to be within the levy for everyone." I do not know whether the Minister thinks that he ought to have made the 40 per cent. levy retrospective. He is entitled to his own views on that subject. The thing is villainous enough as it stands, but it would have been even worse had he done that. But to push this question to one side, and to make this sort of statement—which impresses Parliament, which makes the laws—is not good enough.
It is not good enough to push the complaint off with talk that, generally speaking, and morally, certain things ought to have been done. The law says that a start of development before 6th April absolves the developer from the 40 per cent. levy. If my constituents have been prevented from benefiting from this provision because of a central Government scheme, they have been prevented because they were being good neighbours. This is an anomaly which inflicts hardship on the developers through no fault of their own.
If I were to let the case stay there, it would just be a matter of making a general appeal to the Minister to see what he could do. Fortunately, bad though the Land Commission Act may be, the Government put into it a Section allowing them to grant exemptions from the levy if anomalies and unfairnesses show themselves. Under Section 63, it is possible for the Minister to exempt from having

to pay this unfair penalty people who are the victims of the sort of anomalies I am describing.
If ever circumstances warranted the Minister laying an Order exempting the developers from the levy then, with all the force and sincerity I can command, I have to say to the House and to the Minister that I cannot think of any circumstances more worthy than these for calling Section 63 into action. If that Section was not intended to rectify an anomaly as glaring as this, why did the Government include it in their Act?
I am not calling upon the Joint Parliamentary Secretary necessarily to give me any detailed undertakings today. This is not a propaganda debate I have initiated. I am quite certain that if, within his Department, he will read what was said and implied to the Peterborough authorities to persuade them to join in this good neighbour scheme—to join in the new Town scheme which, to some extent, mitigates against- their own previous separate local powers, because of the development corporation being set up; if he sees how they have tried to co-operate in the highest sense of good neighbourliness, and if he can recognise, as I have tried to show as clearly as I can, that through no fault of their own certain people are to suffer great hardship, and that in his own legislation he has been given the power to rectify such hardship, I think that, on the narrow ground of being fair and the wider ground of keeping his undertaking to Peterborough, here is a matter that ought to be looked at with sympathy and concern.
I therefore do not ask the hon. Gentleman for a detailed reply now. He will acknowledge my case, I know, with all the courtesy and skill he always uses in the House, but I cannot expect him, in an Adjournment debate, to give an undertaking that will clear this matter up right away. But I do ask him to accept the force of the case and say that he will have it examined in detail and fairly in the Department. I ask him to say that if what I have said can be substantiated by examination in the Department, he will give second thoughts to the subject in order to have the matter put right. I ask for no more than that at the moment, but I beg him not to attempt to try to slide over it with generalities


which may not give the appearance of a negative.
I have brought this matter before the House as early as this rather than dealing with it by correspondence with the Department purely because of the date. This levy comes into operation on 6th April, and I felt that in view of the first reply I got—which, I hope, was sent unwittingly—I should put the whole thing on record here as soon as possible. In the interests of his own Department and of the relations we want to see between the central Government and the local authorities, I hope that the hon. Gentleman will say that he will have his Department look at the matter with sympathy, and with all the bias necessary to suggest that it will use Section 63 to put this anomaly right.

12.46 p.m.

The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Arthur Skeffmgton): The hon. Member for Peterborough (Sir Harmar Nicholls) has put his case very forcibly and very clearly. I tell him at once that although I think the issues are very clear, and that what I have to say will be quite definite, one always wants subsequently to examine all that has been said in such a debate as this, when an hon. Member raises a very important constituency point. I can assure the hon. Member that if I have missed anything that he has said or any point that he has made, we will read the OFFICIAL REPORT very carefully and consider the whole gravamen of his charge.
The hon. Member has really sought to exempt from the betterment levy certain cases of building development in the City of Peterborough, where planning permission has, for the reasons he has given, so far been refused. He points out that if the developers are unable to start operations before 6th April they will become liable to assessment for development levy under the Land Commission Act, 1967.
As he has said, the background is the decision in principle of the Minister of Housing to expand the City of Peterborough under the New Towns Act in order to take this very large additional population of about 70,000 from London's overspill. This decision was announced in February, 1965, after long

consultations with all the parties concerned, and a draft Order was laid in October, 1966, which designated 18,000 acres in and around the city. The hon. Member will be aware that a public inquiry was held in January of this year, but as we are still awaiting the inspector's report he will not expect me to comment.
I would say in regard to the first part of the hon. Member's case that, as far as I am aware, the relations between the Ministry of Housing, the Peterborough authority, the county council, and so on, are excellent. I do not think that any charges of bad faith have been made—

Sir Harmar Nicholls: Not yet.

Mr. Skeffington: I want to put this on record, because I am not sure that the hon. Member was going as far as that. Perhaps he was anticipating making such a charge if I did not give the answer he wanted but that, again, may not be exactly how matters will work out. I can assure him that there will be the utmost good will and assistance that we can give from the centre to aid Peterborough in what will be a very considerable and exciting experiment in expansion, and one that will also be in the interests of Peterborough itself.
Following the decision of February, 1965, the local authority which had delegated powers from the county council, agreed to the policy of an interregnum on certain planning applications which came before it, as the hon. Gentleman said. That was done because immediately after the February announcement a very distinguished consultant was appointed, first to advise on the existing area, within and without the town, which should be designated for the site of the new town and, subsequently, to prepare a basic plan for expansion.
The policy of the authority was that, a consultant having been appointed, proposals affecting the existing town, and particularly the central area, should not be prejudiced, and there was therefore this interregnum on significant planning applications in the existing town. Possible developers were persuaded to hold up applications until the new proposals were known, and in some cases they voluntarily agreed to do so. That should be put on the record, and one is very glad that such agreement to defer has been possible.
In the second paragraph of his letter to my right hon. Friend, on 10th February, the hon. Member said:
As you know, due to the proposed expansion of the city of Peterborough, an interregnum has been placed on many sites and buildings during the last 18 months which have either detailed or outline planning permission.
The hon. Gentleman is wrong about that —I am not altogether certain that that invalidates his general argument, but, for the sake of the record, I ought to get this clear. Since the hon. Member put down this subject for discussion, I have naturally made some inquiries, but I do not think that there are any cases in which detailed permission has been given and which could have been affected by the moratorium.
The legal position is that once detailed planning permission has been given, that is that. I suppose that it would be possible for an authority again to have negotiations, but once planning permission has been allowed, it is a matter for the developer. In the short time at my disposal, I have not been able to go into the matter exhaustively, but, in general, I think that all the significant applications, some of which the hon. Gentleman mentioned, have not been affected by the interregnum policy when outline planning permission has been given. It may be so in one or two cases.
I suppose that there are 11 that could be called significantly large-scale applications to develop within the area under discussion and, from a very quick perusal, it seems that permission has been refused at a preliminary stage. Incidentally, one is now the subject of an appeal to my right hon. Friend, so I cannot say anything about that, but even in that case it was an outright refusal of the scheme as a whole. I should make that clear, because at least it makes the issue much simpler.
I do not think that the hon. Gentleman disagrees with the policy of the interregnum. Obviously, if one has a master plan for an area, it is absurd to allow planning permissions and then either have to buy back those permissions at inflated compensation prices, or acquire the land in respect of which planning permission has been given. The hon. Gentleman is arguing that because of

the action of the planning authority in asking for deferment for at least a year, and sometimes longer, no operations could start and so levy will be payable.
This is a very natural argument for any hon. Member to make on behalf of his constituents and I am sure that if I were in the hon. Gentleman's position I would be making the same sort of plea. However, if he considers the matter, I think that he will realise that it is an extremely difficult thing to do, even under the provisions of Section 63 of the Land Commission Act. Perhaps I should explain why that Section is there. We are here dealing with a levy upon betterment value, that is, the difference between the existing use value of the site and its value when a planning permission has been given, although betterment may arise in some other way.
This is a matter of the raising of revenue and the body responsible will be the Land Commission. On the canons of good government which most of us in the House would accept, it would be impossible and intolerable when dealing with the raising of revenue to have any variation, either in the rate of the levy, or in its application, except by the decision of Parliament itself and, therefore, the Commission will have no discretion either to make exemptions or to decrease the rate of levy. Those will be matters to be determined by both Houses of Parliament.
However, when the legislation was being framed, it seemed that there might arise some kind of occasion—I suppose that it might be associated with a large-scale disaster—when the Government themselves might want to take action and where there might need to be rebuilding. Without Section 63, the only thing which the Government could do would be to promote special legislation to meet that kind of case. That would seem to be a lack of foresight and there is, therefore, an ultimate reserve power in the Act so that the Minister can lay an Order, which would have to be affirmatively approved in both Houses, making the exemption. That is the sort of occasion on which Section 63 could he used. It was never intended to be applied to a small number of cases in circumstances of the sort which the hon. Member has outlined.

Sir Harmar Nicholls: I agree that it has to be something significant and separate from the normal flow of things. The expansion of Peterborough, Ipswich and Northampton was announced by the Minister himself as the first of its kind ever to be tried. He said that they were guinea pigs and that the Government wanted to see how the scheme worked. It was a significant departure, he said, from anything which had gone before. Surely that justifies a separate distinction and the application of this Section.

Mr. Skeffington: At this stage, I shall have to differ from the hon. Gentleman about the constitutional meaning and application of the Section. Even if it had been intended to cover cases of this kind, there are other considerations which would have to be taken into account. Whether building operations start before 6th April depends on a number of factors. Failing to get planning permission is obviously one.
Even supposing we accept the hon. Member's plea and agree tha tthis Section can be worked—and I think that we would be constitutionally challenged if we attempted to use it—it would be impossible to say that the only reason why building operations had not started—so that the development was therefore not liable to levy—was failure to obtain planning permission. One would have to know whether the land was available and whether it could be transferred in time, whether the financial arrangements were all right and whether all the developers would agree. Administratively, that would be almost impossible to determine.
One has to fix a particular date. Frankly, if we could have made the date much earlier, we would have done so. It was to be 1st March.

It being One o'clock Mr. DEPUTY SPEAKER suspended the Sitting till half-past Two o'clock, pursuant to Order.

Sitting resumed at 2.30 p.m.

PRIVATE BUSINESS

EDINBURGH CORPORATION ORDER CONFIRMATION BILL

Considered; to be read the Third time Tomorrow.

PETITION

Overseas Students

Mr. Crouch: I beg to ask leave to present a Petition from the students and staff of the University of Kent at Canterbury, containing 296 signatures, which shows that the proposed alterations in the existing scale of grants to universities will result in students from overseas being charged much higher fees than at present, that it is undesirable to discourage students from overseas from coming to British universities, and that this would be damaging both to the universities of this country and to the interests of the other countries concerned.
Wherefore, your Petitioners pray that the system of grants to universities be not altered in such a way as to discriminate against students from overseas.
And your Petitioners, as in duty bound, will ever pray.

To lie upon the Table.

ORAL ANSWERS TO QUESTIONS

BOARD OF TRADE

Machinery Imports

Mr. John Hall: 1. Mr. John Hall asked the President of the Board of Trade why the arrangements made for the remission of duty on the import of goods referred to in paragraphs 1(b) and 1(c) of the Fourth Schedule to the Import Duties Act, 1958, have been suspended.

The Minister of State, Board of Trade (Mr. George Darling): Because my right hon. Friend is no longer satisfied that it is expedient for such relief to be given.

Mr. Hall: Is not the Minister of State aware that there are still many items of

machinery which are imported under this Schedule which cannot be made in this country and which are essential for manufacturing processes in this country. Will he not reconsider this matter?

Mr. Darling: No, Sir. The applications for remission of duty on imported machinery apply only to a small part of our machinery imports, and the advantage of remission, if it is granted, is decreasing as tariffs come down. Secondly, in order to deal with the applications, the Board of Trade has to keep a very large staff of officials and technical experts. A further point is that there are cases where remission of duty has been granted and where this fact has been publicised by the foreign manufacturers as showing that the foreign machinery is much better than the British machinery which we wish to export.

Contracts (Exclusion Clauses)

Mr. Carter-Jones: 3. Mr. Carter-Jones asked the President of the Board of Trade if he will now take steps to prevent the hardships caused by exclusion clauses in guarantees and contracts for the sale of goods.

Mr. Darling: Exclusion clauses in all types of contracts are now being studied by a working party set up by the Law Commission and the Scottish Law Commission. My right hon. Friend would prefer to await their report before considering legislation on this complex subject.

Mr. Carter-Jones: I thank my right hon. Friend for his reply. Is he not aware of the large number of cases of real hardship suffered by people who are caught under these exclusion clauses? Would it not be possible to introduce separate legislation for this specific issue, as was proposed in the other place?

Mr. Darling: We have considered this suggestion. Although we are aware of the number of cases that need to be dealt with, we think that the better way of doing it is in the comprehensive way we have suggested. My hon. Friend should bear in mind the good work that the Consumer Council is doing, both in persuading manufacturers to drop exclusion clauses and in persuading customers not to accept them.

Textiles

Mr. Fletcher-Cooke: 6. Mr. Fletcher-Cooke asked the President of the Board of Trade what is the maximum rate of the tariff still imposed by Portugal upon United Kingdom textile products.

The President of the Board of Trade (Mr. Jay): The rates charged by Portugal on textile products of E.F.T.A. origin vary from nil to 864 Escudos per kilograme (about £5 per lb.). The highest rate applies to a few made-up articles of silk. Most cotton piece goods enter duty free.

Mr. Fletcher-Cooke: Since Portugal is such a low-cost country, as we know to our cost, what is the need for this protection for a member of E.F.T.A. now?

Mr. Jay: I agree that there is something unfair and to some extent unequal in this arrangement, but it is due to the agreement made by the Conservative Government, which the hon. and learned Gentleman supported and which I cannot now legally depart from.

Mr. Arthur Davidson: When can my right hon. Friend tell the House the results of the talks he has had with the Portuguese Minister? Is my right hon. Friend taking a very strong line about imports coming into this country from Portugal?

Mr. Jay: I can say to my hon. Friend neither less nor more than I said yesterday—that, having had these talks, I have every reason to think that imports from Portugal of cotton textiles over this year will be at a lower rate than in recent months.

Mr. Burden: Would not the right hon. Gentleman agree that, irrespective of the present position, if we go into the Common Market and liberalise trade and remove tariff barriers, the same position is likely to occur in the future with other countries and that nothing can be done about this if it is the Government's intention to liberalise trade?

Mr. Jay: That is quite definitely another question.

Mr. J. T. Price: Does not my right hon. Friend understand—I am sure that he does—that the present unfair trading relationship with Portugal is throwing

many textile operatives in Lancashire out of work and, if this state of affairs goes on, the position will go from bad to worse? His statement yesterday did very little to relieve the feeling in Lancashire that we are getting the worst of all possible worlds because of the bad arrangements and bad treaties into which we have entered in the past. Cannot my right hon. Friend set about re-negotiating these arrangements to give British industry a chance to have a fair crack of the whip?

Mr. Jay: I am sure that my hon. Friend was glad that I was able at least to make the statement which I did make. It may interest him also to know that last year we exported nearly £4 million worth of textile goods to Portugal.

Sir A. V. Harvey: 7. Sir A. V. Harvey asked the President of the Board of Trade what steps are being taken to improve trading conditions of the textile industry in view of heavy imports.

Mr. Jay: This Government have already gone further than any previous Government to limit and stabilise imports. But we cannot isolate the textile industry from changes in the general level of consumer demand. The position should improve as soon as distributors begin to replenish their stocks.

Sir A. V. Harvey: Does not the President of the Board of Trade appreciate that what is happening in Lancashire and parts of Cheshire now is putting many industries in a worse state than they were in 30 years ago? What he said yesterday is all right, but will he take some responsibility and do something himself which will show immediate results to people in the North of England?

Mr. Jay: What we have done is to get agreed a global quota of imports affecting nearly 60 countries, whereas the previous quota affected more nearly six countries. This is a great step forward. I am sure that the hon. Gentleman, who understands these things, realises that in the second half of last year imports were lower than they were in the second half of the previous year.

Mr. Mapp: We acknowledge some easement, slight though it may be, in what my right hon. Friend told us yesterday, but will he take a long-term look at


the industry and, having done that, consider an independent inquiry which might look ahead even beyond 1970 to an improved state of affairs in an industry which is at this time recurrently going through crisis after crisis?

Mr. Jay: Yes, Sir; but the global quota of which I spoke lasts until 1970 and, therefore, although it may not be long-term, it is at least medium-term. In addition, we are assisting the Textile Council to carry out a productivity survey in the industry, which will be long-term. I think that that is the right next step.

Mr. Chichester-Clark: Will the right hon. Gentleman bear in mind the concern of people in the shirt industry in relation to Portuguese imports, and will he make a statement on this matter as soon as possible so that they may know where they stand?

Mr. Jay: In so far as those imports come from Portugal, they will be covered by the statement I recently made.

Mr. Ronald Atkins: Would it not be wise to start bringing the level of imports into this country into line with the corresponding level in the Common Market countries, with similar status to our own, which import a far smaller proportion of home consumption?

Mr. Jay: It would be far better from the point of view of the developing countries if we could bring the level of imports into the E.E.C. countries more into line with imports into Britain. This is what we are attempting to do through the Kennedy Round and in other ways.

Mr. Barnett: 30. Mr. Barnett asked the President of the Board of Trade if he will make a statement on the textile industry.

Mr. Hale: 24. Mr. Hale asked the President of the Board of Trade whether he will make a statement on the recent discussions with the Textile Council and on the Government's proposals to assist the textile and man-made fibre industry.

Mr. Jay: As I informed the House yesterday, the Textile Council has, following discussions with me, set up an Imports Commission. As to measures the Government have taken to assist the industry, I would refer my hon. Friend to the reply which I gave to my hon. Friend

the Member for Accrington (Mr. Arthur Davidson) on 8th February.—[Vol. 740, c. 1651.]

Mr. Barnett: Has there been any specific representation from the industry, particularly from mill owners who we know import foreign yarns themselves, against the idea of giving executive powers to the Imports Commission. If not, will my right hon. Friend give a specific pledge that if the present advisory powers are not sufficient, he will give the Commission specific executive powers to stop, control and regulate the import of cotton and synthetic textiles?

Mr. Jay: I am not aware of any such representation from mill owners, but I assure my hon. Friend that I am in favour of this Commission having all executive powers short of the legal powers conferred on my Department by Parliament which I cannot possibly farm out to anyone else.

Mr. Hall-Davis: Does the right hon. Gentleman recognise that, in view of the January import figures, which are an all-time high, what is needed is not information and advice by his Department, but action to implement the pledge he gave to the cotton industry conference in October 1965?

Mr. Jay: These figures were clearly exceptional because of the end of the surcharge and the E.F.T.A. tariffs on 1st January. Since the global quota, covering 60 countries, is on an annual basis, if it increases in one part of the year imports are bound to be fewer in the latter part of the year.

Mr. Thornton: Is it my right hon. Friend's intention to use the Commission as a machine for effectively dealing with quota evasion and price disruption?

Mr. Jay: Yes, I hope that will be one of its important functions, although not the only one.

Mr. Fletcher-Cooke: What is new in the machinery announced by the right hon. Gentleman yesterday? Had not the Textile Council and the Cotton Board before done this work for many years? Was not the announcement merely a declaration of what has been happening for some 10 years or more?

Mr. Jay: I have been asked by many sections of the industry to make this arrangement. If the hon. and learned Gentleman is opposed to it, he is out of tune with opinion in the industry.

Mr. Fletcher-Cooke: 44. Mr. Fletcher-Cooke asked the President of the Board of Trade whether he is aware that Portuguese exporters of textiles receive a special subsidy on raw cotton grown in Mozambique; and if he will make representations to the Portuguese Government that this breach of international trading practice damages British interests.

Mr. Jay: I would refer the hon. Member to the reply I gave to the hon. Member for Preston, North (Mr. Ronald Atkins) on 8th March.—[Vol. 742, col. 298.]

Mr. Fletcher-Cooke: I have not had the advantage of seeing that reply. If it is not true that it is subsidy, what is the explanation for the extraordinary low cost of Portuguese imports into this country? Is it solely a matter of abysmally low wages, or is there some other explanation?

Mr. Jay: The subsidy to which the hon. and learned Gentleman refers is, so I am informed by the Portuguese Government, a method of ensuring that Portuguese manufacturers who buy from Portuguese territories in Africa at above world prices are put on a level with manufacturers of other countries. The main reason for the low prices of Portuguese textile imports into this country is that the Portuguese industry is technically extremely efficient as well as admittedly paying wages which are much lower than ours.

Mr. Frank Allaun: How can Lancashire compete with wages of 9s. a day in Portugal and 10s. a day in Hong Kong? Can my right hon. Friend do something with the Government of Portugal and through the trade unions of Hong Kong, trade unions not being allowed in Portgual?

Mr. Jay: Many British manufacturers compete successfully in Canada and the United States where wages are very much higher than they are here. However, I should be delighted to see a rise in wages in Portgual and I think that the over-

whelming E.F.T.A. movement is in that direction.

Mr. Gregory: 47. Mr. Gregory asked the President of the Board of Trade what progress has been made in improving ways in which anti-dumping legislation can be brought into operation on the import of cotton and man-made fibre textiles; and if he will make a statement.

Mr. Jay: I have nothing to add to the reply I gave to the hon. Member for Louth (Sir C. Osborne) on 8th February. —[Vol. 740, col. 307.]

Mr. Gregory: Is my right hon. Friend aware that the measures announced yesterday will be welcomed by the industry? Is he further aware that there is a great need for these measures to be applied as quickly as possible? In my constituency there have been many closures and we have a handful of mills—

Mr. Speaker: Order. We cannot have speeches at Question Time. Questions must be brief.

Mr. Gregory: Is my right hon. Friend aware of the need to do something to stop this trend?

Mr. Jay: I am actively seeking evidence which would enable us to introduce an anti-dumping order, both from the Textile Council, sections of the industry and our commercial posts abroad. If my hon. Friend has material which would help, I should be very glad to have it.

Mr. Heffer: In relation to the position over Portugal, would my right hon. Friend indicate whether the matter has been discussed with E.F.T.A.? Would he not agree that if we were members of the E.E.C. and accepted the Treaty of Rome, this position would not arise?

Mr. Jay: That arises on the next Question.

Mr. Gregory: 48. Mr. Gregory asked the President of the Board of Trade what action he proposes to take, to deal with the disruptively priced imports of condenser yarns on cone, jacquard blankets and flannelette blankets, as referred to in the recent letter and evidence submitted by the hon. Member for Stockport, North; and if he will make a statement.

Mr. Hale: 25. Mr. Hale asked the President of the Board of Trade whether he is now


in a position to make a statement on recent investigations into excessive textile imports from Portugal and, in particular, of sheeting.

Mr. Jay: I took the opportunity in Stockholm in the week before last to discuss this matter with the Portuguese Government, and I have every reason to expect that the rate of cotton textile exports from Portugal to the United Kingdom this year will be substantially less than in recent months.

Mr. Gregory: Is my right hon. Friend aware that in this instance we are dealing with imported yarns rather than finished products? Can we give some guarantee to the industry to restore confidence and stop the rot?

Mr. Jay: The statement that I have made covers yarns as well as made-up goods.

Mr. Fletcher-Cooke: What are the exact terms of the agreement with the Portuguese Government? Would the right hon. Gentleman lay a White Paper, or some other document, explaining what undertakings he has reached with the Portuguese Government, in what terms and involving what statistics?

Mr. Jay: If I were to elaborate further on this I should do damage to the cause which both the hon. and learned Gentleman and I have at heart.

Advanced Factories, Ashington

Mr. Will Owen: 21. Mr. Will Owen asked the President of the Board of Trade what progress has been made in finding tenants for advanced factories at Ashington, Northumberland.

Mr. Darling: Both factories have been brought to the attention of a number of firms. One firm has expressed interest in the smaller factory, but so far there have been no applications for tenancy.

Mr. Owen: While I thank my hon. Friend and his Department for their initiative in the development of these advanced factories, is he aware of the increasing unemployment in the area? If private enterprise fails to take advantage of the existing facilities, will the Government take action in introducing a growth industry there?

Mr. Darling: The second part of my hon. Friend's Question concerns something we are prepared to consider at any time. I think that the fact that we have to face is the need to provide about 800 jobs. The second factory, which is the larger one, will be completed in a few months' time and will, we hope, prove the magnet to attract new industry to the Ashington area.

Sir J. Eden: Before building these factories, what study is made of the number of companies likely to become tenants and the nature of their requirements?

Mr. Darling: It is not specific for any individual factory, but the Board of Trade has a great deal of information about the inquiries made by firms all over the country covering practically every industry. We hope that from that information we can get people to go to the areas we wish them to go to.

Publications (Management and Ownership)

Mr. Whitaker: 23. Mr. Whitaker asked the President of the Board of Trade whether he will seek legislation to require all publications to publish in them details of their management, ownership and editors.

Mr. Jay: No, Sir. The new Companies Bill will provide for the publication of more extensive information about the ownership and control of companies, including those issuing publications.

Mr. Whitaker: Is my right hon. Friend aware that the United States successfully enacted such a Measure on 23rd October, 1962, to the benefit of both Press freedom and impartiality?

Mr. Jay: We do not necessarily have to follow everything done in the United States, but the new Companies Bill will cover a great deal of the ground which is, I think, enough to go on with.

Manufacturing Industry (Investment)

Mr. Biffen: 27. Mr. Biffen asked the President of the Board of Trade by what amount he expects investment in manufacturing industry during 1967 to differ from that undertaken during 1966; if he is satisfied with the prospective figures; and


what proposals he has to encourage the profitable use of capital assets.

Mr. Bruce-Gardyne: 61. Mr. Bruce-Gardyne asked the President of the Board of Trade if, in view of the 6 per cent. decline at constant prices in industrial investment in the private sector between the third quarter of 1964 and the fourth quarter of 1966 and the further 10 per cent. decline at current prices forecast by his Department in 1967, he is satisfied with the working of the Industrial Development Act; and if he will make a statement.

Mr. Jay: I would refer the hon. Members to the Answer I gave the hon. Member for South Angus (Mr. BruceGardyne) on 1st February.—[Vol. 740, c. 496.]

Mr. Biffen: Does the right hon. Gentleman realise that that Answer is every bit as unsatisfactory as the Answer he gave to my hon. Friend the Member for South Angus (Mr. Bruce-Gardyne)? Will he confirm that the Board of Trade on the latest reckoning expects investment in manufacturing industry to fall by 10 per cent. during the current year compared with last year? Will he confirm that last year it was below the level of 1965? Will he recognise that it is the prospect of profits much more than anything else which will encourage British industry to start investing?

Mr. Jay: No, Sir. The hon. Member is wrong. The figure for last year was almost exactly the same as it was in 1965. The forecasts for the present year do show a fall, but there are expansionary forces working in the economy, particularly the rise in exports and also public expenditure, which will increase demand. It remains to he seen whether this fall will continue.

Mr. Patrick Jenkin: Does the right hon. Gentleman recognise that the final outcome of investment for 1966–67 was somewhat below his recent optimistic assessment of what it would be? Has he yet made a revised assessment in the light of that for 1967? Is not the figure of 10 per cent. in the last survey going to prove too low? Will it not fall more than that?

Mr. Jay: The hon. Member always fails to distinguish between fact and fore-

casts. So far these are mere forecasts for 1967, and the figure for 1966 was only up to 1 per cent. less than in 1965.

Motor Insurance Companies

Mr. Whitaker: 29. Mr. Whitaker asked the President of the Board of Trade which motor insurance companies his Department is investigating at present.

Mr. Darling: The following five motor insurance companies are being investigated by inspectors appointed by the Board of Trade:

Fire Auto and Marine Insurance Co. Ltd.
Irish-American Insurance Co. Ltd.
 Coventry Insurance Co. Ltd.
London &amp; Cheshire Insurance Co. Ltd.
London &amp; Midland Insurance Co. Ltd.

Mr. Whitaker: Is my right hon. Friend aware that there are a number of other murky insurance companies known in the City and to newspapers but that they are unable to warn the ordinary motorist about them because of the libel laws? Is he aware that there is overwheling support for a State motor insurance scheme?

Mr. Darling: We shall certainly consider the second part of that question. I would prefer not to comment on the first part at this stage.

Sir H. Harrison: Is the Minister aware that if his Department had seen whether these insurance companies had the proper amount of assets over liabilities laid down by law these frauds would not have taken place? He is advised by responsible companies to do this.

Mr. Darling: The hon. Member was mistaken in the way he put the question. In the Companies Bill, which is going through the House, we are giving the Board of Trade proper authority to supervise all insurance companies engaged in this kind of business.

European Economic Community

Mr. Biffen: 34. Mr. Biffen asked the President of the Board of Trade if he will make a statement outlining the expected consequences for United Kingdom trade in


temperate foodstuffs with Australia and New Zealand should Great Britain join a Common Market enlarged to include Denmark and operating the system and price structure of the current European Economic Community agricultural policy.

Mr. Jay: Detailed estimates must depend on the terms of any agreement reached: but the imposition of any barriers to reciprocal trade must, of course, be injurious to the United Kingdom, Australia and New Zealand.

Mr. Biffen: Is the right hon. Gentleman aware that he has not answered the Question, which asked for an estimate of the consequences on the existing price structure and system of the Common Market, not on anything which might subsequently be negotiated? Why will he not share with the House the judgments which he has revealed to selected Labour back benchers?

Mr. Jay: The hon. Gentleman cannot have heard the first part of the Answer which was that detailed estimates, statistical estimates, must depend on the terms of any agreement reached and, of course, any statistical estimate must depend on the extent to which a common agricultural policy is applied to Commonweath and United Kingdom trade.

Mr. Corfield: The right hon. Gentleman said that any increase in barriers to trade must harm Great Britain. Is that the view of the Government about going into the Common Market?

Mr. Jay: Yes, Sir. Clearly, any new barrier against trade would diminish trade and therefore be injurious to the countries concerned.

Wales

Mr. Gwynfor Evans: 37. Mr. Gwynfor Evans asked the President of the Board of Trade whether the number of 226 men employed in State-owned manufacturing projects in Wales, for which industrial certificates have been issued since 1964, has now increased; and if he will make a statement.

Mr. Jay: I would refer the hon. Member to the reply given to him by my right hon. Friend the Minister of State on 3rd March.—[Vol. 742, c. 169.]

Mr. Evans: Is not the right hon. Gentleman deeply ashamed that a

Socialist Government should have been so irresolute and apathetic when confronted with the wretched situation in Wales that, after two and a half years, new State-owned industries and projects still employ only 226 men? Would he not agree that it would require a genius in a Welsh Government to achieve such a resounding failure?

Mr. Jay: The hon. Gentleman may be interested to know that the total number of people employed in Board of Trade owned factories in Wales is not 226, but 64,000.

Mr. Evans: On a point of order. Is it in order for me to say that I quoted the figure of 226 from an Answer given to me by the Board of Trade?

Mr. Speaker: That is a matter of fact, not of order.

Mr. Manuel: Will my right hon. Friend tell the hon. Gentleman that the best advice which he can give to Wales is that Welsh industrialists should invest in their own industry and that Wales should not depend on help from outside?

Mr. Jay: The best advice which I can give to the hon. Gentleman is to study the facts.

Pleasure Boats (Licensing)

Mr. Wall: 40. Mr. Wall asked the President of the Board of Trade what regulations he is proposing to introduce for the licensing of pleasure boats plying for hire and for privately-owned boats and yachts.

The Minister of State, Board of Trade (Mr. J. P. W. Mallalieu): None. All pleasure craft carrying over 12 passengers require a Board of Trade certificate and those plying for hire with lesser numbers can be most effectively controlled under local licensing powers. I do not consider that comprehensive regulations for licensing small craft used privately for pleasure would be justified at present.

Mr. Wall: Is the hon. Gentleman aware that that Answer will give great pleasure to the yachting fraternity which often goes to sea to get away from bureaucracy on the land?

Mr. McNamara: Can my hon. Friend say what extra measures he has taken to ensure that the regulations at present in force are enforced by regular inspection?

Mr. Mallalieu: We have already called the attention of the local authorities to their powers and we propose to bring forward legislation which will increase the penalties for infringement.

Advance Factory, Stanley

Mr. David Watkins: 45. Mr. David Watkins asked the President of the Board of Trade if he is yet able to announce the tenant for the advance factory at Hare Law, Stanley, County Durham.

Mr. Darling: The first advance factory at Stanley is already taken and has been extended to meet the needs of the occupying firm. The second advance factory is under construction and has been brought to the attention of a number of industrialists, but no tenant has so far been found.

Mr. Watkins: Will my right hon. Friend bear in mind that because of pit closures, there is a particular need for new industry in this part of County Durham? Can he assure the House that every possible effort will be made to have this tenancy taken up as quickly as possible?

Mr. Darling: Yes, Sir. We are aware of the circumstances and the need for new jobs in this area. The success of the first factory augurs well for other development.

Sir J. Eden: Will the right hon. Gentleman say what is the average length of time taken to find a tenant for an advance factory? Can he also give figures showing the number of factories standing empty in the North-East region?

Mr. Darling: I think that there are only one or two in the North-East region, but I should like notice of that question. The length of time needed to get a tenant varies considerably. Quite a number of them are accepted before the factories are finished. This was the case with the first factory at Stanley.

Patent Office (Location)

Mr. Patrick Jenkin: 46. Mr. Patrick Jenkin asked the President of the Board of Trade when he will announce the results of his current review to move the Patent Office from its present location in central London.

Mr. Darling: After close examination, I have decided that the site which was

being considered in Croydon would not be suitable for the Patent Office. We shall be examining other possible locations.

Mr. Jenkin: Does the Minister of State recognise that that Answer, which conflicts completely with the Answers that he has given to the House hitherto on this subject, is none the less welcome, and that many of those who use the Patent Office will be very glad that he has reconsidered this particular proposal? Will he also reconsider the suggestion to move the Patent Office out of London altogether? Does he not recognise that there is a very considerable case for keeping this office in the centre of London, where it is easy of access, particularly for people from abroad?

Mr. Darling: I will not accept that Answer that I have just given conflicts with anything that I have said before. Croydon would have been a most satisfactory location if we had been able to find either a suitable site or suitable buildings. We were unable to find either.

Mr. Frederic Harris: Does the Minister appreciate that, contrary to the view expressed by my hon. Friend, the Answer that he has given will bring great disappointment to Croydon, because we were hoping to welcome the staff of the Patent Office within our town? Is this the end of his interest in Croydon or is it a turning down of the Trinity site? Would the right hon. Gentleman consider other sites in Croydon?

Mr. Darling: All the other available sites in Croydon have been examined. With regard to the second part of the supplementary question of the hon. Gentleman the Member for Wanstead and Woodford (Mr. Patrick Jenkin), which I did not answer, we shall go on looking for suitable sites on the perimeter of London because we think that the Patent Office, and a number of other enterprises in the centre of London, ought to move out.

Mr. Rankin: Would my hon. Friend also remember that there are plenty of suitable sites in Scotland? Does he realise that Scotland is not getting a fair crack of the whip in these matters?

Mr. Darling: I agree that we should try to put more offices of various kinds


into Scotland, but in this case the Patent Office needs to be, at the most, one hour's travel from the centre of London.

Sir J. Eden: Has the right hon. Gentleman completely forgotten that on 8th December last he said that he had gone very carefully into the pros and cons of this move? Will he try his best to keep this office in the centre of London, where it obviously should be?

Mr. Darling: I certainly do not agree that it should be in the centre of London. We will go on looking for a suitable location.

Zambia

Mr. Wall: 50. Mr. Wall asked the President of the Board of Trade what assistance he is making available to British companies in tendering for the Kafue hydroelectric project worth £25 million in Zambia, for the proposed fertiliser and explosive factory and for the operation of Zambian Airways.

Mr. Darling: I am not aware that tenders have been invited for any of these projects. The Board of Trade's export promotion services, and where appropriate those of the Export Credits Guarantee Department, are available for interested British companies.

Mr. Wall: Is the Minister aware that during the past year major Zambian contracts have gone to American, Japanese, French and Italian firms, at a time when the British taxpayer has been supporting the Zambian economy to the tune of £15 million? Will he see what he can do to improve the competitiveness of British firms in Zambia, and also to discourage anti-British feeling there?

Mr. Darling: We will certainly do all that we possibly can to help British firms to obtain contracts in Zambia. Aid to many countries involves contracts being given to the countries providing the aid, which is one of the factors that we have to take into account. We will certainly take into consideration all the points that the hon. Member has raised.

Mr. James Johnson: Is the Minister aware that many of us on the benches behind him thought that the Kafue scheme of 10 years ago was a better project, than Kariba? Will he do his best

to help the Zambian Government in this matter?

Mr. Darling: I am aware of what my hon. Friend has said.

AVIATION

Air Hostesses

Dr. Miller: 2. Dr. Miller asked the President of the Board of Trade if he will issue a general direction to British European Airways and the British Overseas Airways Corporation not to refuse applications from otherwise suitable candidates for air hostess positions on the grounds of colour or race or religion.

Mr. J. P. W. Mallalieu: No, Sir. I am satisfied that as a matter of policy the Air Corporations do not refuse applications on those grounds.

Dr. Miller: I thank my hon. Friend for his reply. I have been told that there are grounds for believing—[HON. MEMBERS: "Question."] Is my hon. Friend aware that there are grounds for believing that discrimination of this type exists? Will he satisfy himself that these grounds have no foundation?

Mr. Mallalieu: I am not aware that there are any such grounds, but, if my hon. Friend has any such evidence and will give it to me, I will get on to it straight away.

B.O.A.C. (Aircraft)

Mr. Fortescue: 4. Mr. Fortescue asked the President of the Board of Trade whether he has received a request from the British Overseas Airways Corporation for authority to purchase further United States aircraft for passenger service; and if he will make a statement on the British Overseas Airways Corporation aircraft availibility position.

Mr. Jay: No such request has been received. B.O.A.C's present service fleet of passenger aircraft consists of 19 Boeing 707–436 aircraft, 12 VC1Cs and nine Super VC10s. In addition, there are two Boeing 707–336C freighter aircraft used solely for cargo operations. In winter one Boeing 707–436 is usually out of service at any one time for major maintenance work. I understand that a substantial programme of modifications


currently makes it necessary to have a second aircraft temporarily out of service. B.O.A.C. hopes to complete this work by June, if not earlier.

Mr. Fortescue: Is the President of the Board of Trade aware that whereas the passenger load factor on VC1Os over the Atlantic was extraordinarily high in 1966, nevertheless the growth of B.O.A.C's cross-Atlantic traffic has been much lower than that of any other airline? Would he not agree that this is almost entirely due to the fact that B.O.A.C. did not order enough VC1Os in 1964?

Mr. Jay: As the hon. Gentleman probably knows, the decision to put the extra 10 VC10 orders into suspense was taken in 1963 by the Conservative Government. Any decision a year ago could not have had any effect whatever in the present situation, which, in any case, is likely to be put right within a few weeks.

Mr. Rankin: Would my right hon. Friend assure us that, if and when B.O.A.C. wants to order further aircraft, he will do everything in his power to make sure that it is VC1Os that are ordered?

Mr. Jay: Yes. I am not sure that it is understood that there are eight SuperVC1Os now on order which will be coming forward in the months ahead as quickly as they can be got ready.

Mr. R. Carr: Is the President of the Board of Trade satisfied that, even when these planes come along, B.O.A.C.'s capacity will be big enough to allow it to take its proper share of this very rapidly expanding air transport market?

Mr. Jay: Yes, that is my information. The present short-term difficulty has arisen because certain faults were discovered in the Boeings in the course of last year and there had to be an emergency programme to put these right. It is hoped that this will now be completed by the middle of May, and I understand that B.O.A.C. is likely to have all services operating by approximately 19th May.

Mr. Ian Lloyd: 9. Mr. Ian Lloyd asked the President of the Board of Trade whether he has any outstanding requests from the British Overseas Airways Corporation for permission to purchase Boeing 707–320C aircraft; how many such aircraft have

already been sanctioned for purchase by the Corporation; and what conditions have been laid down regarding their use for passenger or freight traffic.

Mr. Jay: The purchase of three Boeing 707–320C freighters has been sanctioned. B.O.A.C. proposes to use the third, which is due to be delivered in November 1967, for passenger service for a temporary period.

Mr. Lloyd: Is the House to take it that the Minister is now directly contradicting the statement made by the Government in March last year on this type of aircraft, and have we an assurance that the continuing dependence on Boeing and "jumbo" jet type of aircraft is not to go on indefinitely?

Mr. Jay: No, Sir; there is no contradiction between what I have just said and what was said previously.

Mr. Ian Lloyd: 10. Mr. Ian Lloyd asked the President of the Board of Trade whether he will refuse to waive the duty on any Boeing 707–320C aircraft purchased by the British Overseas Airways Corporation which may be used for carrying passengers as well as freight; and whether he will rescind the waiver of duty on any such aircraft originally purchased for the carriage of freight only but which may now be used partly for the carriage of passengers.

Mr. Jay: Applications will be considered on their merits in accordance with the law. I am not aware of any intention to change the use of aircraft which have already been imported.

Mr. Lloyd: Does the President of the Board of Trade realise that this will do nothing to reassure those who believe that in this, as in so many other spheres, the Government seize every opportunity to discriminate, on duty matters particularly, between public and private enterprise?

Mr. Jay: No, Sir; there is no discrimination whatever between publicly and privately owned aircraft. We take these decisions purely on the basis of the type and function of the aircraft in accordance with the law which I have to follow.

Mr. R. Carr: Will the right hon. Gentleman confirm that it is still the policy of


the Government that the waiver of duty to B.O.A.C. is conditional, based upon the specific understanding that these aircraft will not be used for anything but cargo purposes?

Mr. Jay: It depends on whether the aircraft is a cargo or passenger aircraft. If they were to be used for a different purpose, that would be something which we should have to consider.

Sir A. V. Harvey: The original Boeings ordered for freighters were ordered with windows, with the clear intention that they would come in for passenger use. Will the right hon. Gentleman give an assurance that this will not be allowed in future?

Mr. Jay: My information is that there is no intention to use these two aircraft for anything except cargo services.

Mr. Hastings: 32. Mr. Hastings asked the President of the Board of Trade what losses have been incurred by the nationalised airways corporations as a result of purchases of United States aircraft.

Mr. Jay: I am not aware of any losses which can be so attributed.

Mr. Hastings: What about the modifications which we have been talking about this afternoon? Is the right hon. Gentleman aware that B.O.A.C. has refused point blank to give the Press the cost of these modifications to the Boeing 707, for instance? What are they? Is it the terminal fin? Is it the engine nascelles? Is there corrosion, or is there not? Would not the right hon. Gentleman agree that under the present rules of order it is almost impossible to get at the facts and that there is a great deal of misgiving about the conduct of affairs at B.O.A.C. and—

Mr. Speaker: Order. Questions must be reasonably brief.

Mr. J. T. Price: On a point of order. Is it in order for hon. Members at Question Time to direct questions to my right hon. Friend and his colleagues on matters of the day-to-day administration of nationalised industries about which a Minister is not responsible to answer at the Box?

Mr. Speaker: The Minister has power in his own hands to answer or not.

Mr. Hastings: In view of the difficulty of getting at the facts, will the right hon. Gentleman consider a debate—[HON. MEMBERS: "Sit down."]—on B.O.A.C. at an early date?

Mr. Jay: The hon. Gentleman seems to be as unfamiliar with the facts of civil aviation as he is with the rules of the House. There have been certain faults—

Mr. Ridley: On a point of order. Can you say in what way my hon. Friend the Member for Mid-Bedfordshire (Mr. Hastings) has transgressed the rules of order, Mr. Speaker? If not, will you direct the right hon. Gentleman to withdraw that offensive remark?

Mr. Speaker: We are not going to have debates on how Ministers answer.

Sir Knox Cunningham: On a point of order. Are not the rules of order in the House for Mr. Speaker and not for any Minister, however distinguished he might think he is?

Mr. Speaker: That applies to the hon. and learned Gentleman, too, I think.

Mr. Burden: On a point of order.

Mr. Speaker: I deprecate points of order during Question Time.

Mr. Burden: On a point of order. In the commotion, I think that the Minister forgot to answer the question.

Mr. Speaker: That is quite possible

Independent Airlines (B.O.A.C. Services)

Mr. Fortescue: 5. Mr. Fortescue asked the President of the Board of Trade if he will take the necessary steps to authorise independent British airlines to serve those routes on which the British Overseas Airways Corporation has had to suspend services this summer.

Mr. Jay: I understand that B.O.A.C. is not proposing to suspend services on any of its routes but is cancelling some flights on eight routes while aircraft are being modified.

Mr. Fortescue: Does the right hon. Gentleman's reply mean that he stands by the present policy that this lucrative trans-Atlantic service should be a monopoly of B.O.A.C. and should not


be open in any way to independent airlines?

Mr. Jay: That is quite another question. The whole of this emergency programme has affected only about 0·3 per cent. of the total flying hours for which B.O.A.C. is responsible.

Mr. R. Carr: Does not the right hon. Gentleman realise that the cancellation of no fewer than 96 flights will mean a substantial loss of business and, therefore, of foreign exchange earnings? Ought not this gap to be filled somehow by whatever temporary emergency measures can be found?

Mr. Jay: Ninety-six flights may sound a lot, but it is only 0·3 per cent. of total flying hours for a period of a few weeks.

Mr. Onslow: Will the President of the Board of Trade stop being so complacent about the fact that B.O.A.C. is turning away good business which should be coming to British airlines?

Mr. Jay: In so far as that is true—it is true only to a small extent—it is due to decisions taken by the Tory Government in 1963.

B.O.A.C. London—New York Service

Sir A. V. Harvey: 8. Sir A. V. Harvey asked the President of the Board of Trade if he will give a direction in the public interest to the British Overseas Airways Corporation to continue to operate undiminished its flights between London and New York from April to June.

Mr. Jay: No, Sir. A direction would not be appropriate. B.O.A.C.'s temporary difficulties over aircraft availability are for the Corporation to resolve.

Sir A. V. Harvey: That is an extraordinary answer. Is the right hon. Gentleman aware that one independent airline offered to operate these 96 flights, which represent a revenue to this country of over £1 million? In the present state of the economy, can the country afford to throw away £1 million to foreign operators? Why is the President of the Board of Trade being so "dog in the manger" about it?

Mr. Jay: I cannot accept the hon. Gentleman's statements without further evidence. The day-to-day running of

B.O.A.C. must be in the hands of the B.O.A.C. board rather than the hands of a Minister.

Mr. Lubbock: Is the right hon. Gentleman aware that, whatever he says in the House, most knowledgeable people are convinced that B.O.A.C. made a serious error of judgment in cancelling the remaining VC10 aircraft? Will he look into the possibility of resuscitating at least a part of the order so that B.O.A.C. may have its rightful share of traffic on the North Atlantic?

Mr. Jay: I agree that the VC10 is probably the best passenger aircraft operating in the world today. What the hon. Gentleman does not appreciate is that if any different decision had been taken a year ago it would not have had the slightest effect on the situation this year.

Mr. Marten: As all this trouble arose, as the right hon. Gentleman told us earlier, from a fault discovered in the Boeings, may we be told whether from the date when the fault was discovered all the Boeings concerned were grounded?

Mr. Jay: I do not think that it was a question of grounding the aircraft either in the case of the British-owned Boeings or those owned by other countries; but certain modifications had to be made, and that is the programme which is now being carried out.

Mr. Hastings: It is not the slightest good blaming the previous Government for the lack of VC10 aircraft with B.O.A.C. now. Whereas the order may have been placed in suspense earlier, it was the right hon. Gentleman's Government who in March last year cancelled 10. In the light of the present crisis, what has the right hon. Gentleman to say about that?

Mr. Jay: The hon. Gentleman has got all the facts wrong. In the first place, it was not the present Government who cancelled the order. It was done by B.O.A.C. exercising its discretion. In the second place, as I have already pointed out twice, no decision then could possibly have affected the situation this year. There are already eight Super VC1Os on order which have not yet been delivered.

Air Safety (Ministerial Responsibility)

Mr. Marten: 11. Mr. Marten asked the President of the Board of Trade if he will make a statement about the divisions of responsibility between Ministries in relation to air safety.

Mr. Jay: I apologise for the length of the Answer.
The Board of Trade is charged, under the Civil Aviation Act, 1949, with the general duty of promoting safety in the use of civil aircraft and the precise functions prescribed in the Air Navigation Order, 1966, made under that Act.
Military aviation is the responsibility of the Ministry of Defence. The National Air Traffic Control Service is provided jointly by the Board of Trade and the Ministry of Defence for civil and military aviation alike. The Ministry of Technology, concurrently with the Board of Trade, has the function of encouraging measures for designing, developing and producing civil aircraft, and the equipment for promoting safety in the use of such aircraft.

Mr. Marten: Is it not clear from what the President of the Board of Trade has just said that there is a split in responsibility for the vital matter of air safety? The inspectorate of accidents is in his Department whereas the people with responsibility for putting right what is wrong in an aircraft which causes accidents are in the Ministry of Technology? Would it not be better to bring the inspector of accidents out of his own Ministry and into Technology?

Mr. Jay: I am not convinced that that is so. There has always been a division of responsibility as between military and civil aircraft. If the hon. Gentleman has specific suggestions to make, I shall be very glad to look at them.

Mrs. Gwyneth Dunwoody: Will my right hon. Friend consider doing something to tighten up the regulations regarding air safety before the holiday season comes, when more and more private charter aircraft will be flying over the Continent, and before we have any more dreadful accidents?

Mr. Jay: The arrangements are already elaborate and everything possible has

been done to make them effective. I have no reason to think that the holiday season will produce any special dangers.

B.E.A. (Aircraft)

Mr. Marten: 12. Mr. Marten asked the President of the Board of Trade if he will make a statement on the acquisition of further aircraft by British European Airways.

Mr. Jay: The Government are considering a proposal made to me by B.E.A. on 24th February for the purchase of a number of BAC2–11s, an aircraft whose characteristics have been evolved by the manufacturers, in consultation with B.E.A., during recent months. B.E.A.'s proposal, which raises a number of important issues, is now under consideration, and I will make a statement to the House in due course.

Mr. Marten: Does the Minister agree that the BAC2–11 is an essential intermediate aeroplane for B.E.A., and that it should not be confused in the Government's mind with the much larger 300-seater airbus? Can he give an assurance that he will see those two aeroplanes as quite separate?

Mr. Jay: There is no confusion whatever in my mind between the 2–11 and the airbus, which are totally separate. On the technical, economic and other merits of the 2–11, I must reserve judgment until we have had time to examine the evidence, which is distinctly complicated.

Mr. Lubbock: Is the Minister aware that one of the reasons for the relatively poor export performance of the British aircraft industry is that too much attention has been paid to the whims of B.E.A.? Will he, therefore, carefully consider before allowing an order for the 2–11 to go ahead, in view of the possible consequences for the go-ahead on the airbus?

Mr. Jay: We want to see a good performance of both British civil aviation and the British aircraft industry. I would not agree with the hon. Member's sweeping statement about the poor performance of the British aircraft industry.

Mr. Lubbock: I said "relatively poor".

Mr. Jay: The 1–11 has been a great export success, particularly in North America.

Mr. Burden: Would the Minister encourage consultation with the independents, some of which could be very big purchasers of this aircraft, to get their views on the specification? That could be very important to the future of the aircraft.

Mr. Jay: I am certainly very ready to listen to their views.

Munich Aircraft Accident (Report)

Mr. Rankin: 13 and 33. Mr. Rankin asked the President of the Board of Trade (1) whether he will publish the Second Report inquiring into the aircraft disaster at Munich Airport with a covering statement giving the reasons for the causes of the accident which are compatible with the evidence now available, in order to clear the pilot of blame for a disastrous loss of lives;

(2) whether he is now satisfied that the accident to Elizabethan G-ALZU at Munich on 6th February, 1958, was due to slush drag and not to ice on the wings; and if he will reject the findings of the second German report since they are in conflict with the conclusions of all the British experts.

Mr. Dobson: 53. Mr. Dobson asked the President of the Board of Trade if he will reject the conclusions of the second commission investigating the Munich air disaster; and whether he will accept instead the views of the British experts contained in that report.

Mr. J. P. W. Mallalieu: Following detailed analysis of the German report, my Department wrote to the German authorities regarding certain technical matters arising from it. Pending their consideration of these matters, it would be inappropriate for me to publish the report or make any statement on its contents.

Mr. Rankin: While I thank my hon. Friend for that Answer, would he not agree that the second report removes from the pilot the unjust charge made against him by the first, and that our experts at Farnborough unanimously agree that the accident to the aircraft was caused by slush drag and not by ice on the wings? Does he agree with that now?

Mr. Mallalieu: I am not in a position to say anything definite on the report, but we have queried a number of technical

points arising from the second report and we are pressing the matter with the German authorities.

Mr. Dobson: Is my hon. Friend aware that there is a need to clear up the question of where the blame lies for that accident? It is grossly unfair on the pilot to be continually blamed, and for his relatives to be involved in this, over many years. I hope that my hon. Friend will press the matter strongly with the German authorities.

Mr. Mallalieu: I certainly agree that there is a great need from all points of view to clear up the confusion that has arisen about the causes of the accident. That is why we are pressing the German authorities very hard now.

New Aircraft (Investment Allowances)

Mr. Onslow: 14. Mr. Onslow asked the President of the Board of Trade what reduction he expects in investment expenditure by British airlines on new aircraft, in view of the fact that investment allowances have been withdrawn and that aircraft do not qualify for investment grants.

Mr. Jay: Numerous factors have to be taken into account by airlines before purchasing aircraft. I am not aware that the consideration mentioned by the hon. Member is by itself having a signficant effect on British airlines' investment expenditure.

Mr. Onslow: That is a most extraordinary reply. Does the Minister not understand that this puts up the cost and must have the effect of increasing domestic freight tariffs and operating expenses? Does he really think that this retrograde revocation of the allowance system does anything to stimulate British independent aviation?

Mr. Jay: There is no evidence that this is having a significant effect. Under the Industrial Development Act, the nationalised industries as a whole and transport services as a whole do not qualify for the grant. In those circumstances, it would be impossible to give it to aircraft.

Nationalised Corporations and Independent Airlines

Mr. R. Carr: 17. Mr. R. Carr asked the President of the Board of Trade in what respects his policy for the rôle of the nationalised


Corporations and independent airlines differs from that announced by his predecessor on 17th February, 1965.

Mr. Jay: There has been no change in the Government's policy, but I do not exclude the possibility of change if experience and our continuing study of the issues show it to be desirable.

Mr. Carr: Is the Minister not aware that the policy does not seem to have been adhered to to the extent that more freedom has been granted to independent airlines on domestic routes? While we welcome this on this side of the House, does he not think that there is a need for more clarity so that both the nationalised and independent airlines can plan ahead with more certainty?

Mr. Jay: I think that there is need for very careful study of this admittedly rather difficult problem, but until we reach precise conclusions I think that it is right to continue the policy laid down by my predecessor.

Export Credits

Mr. Carr: 18. Mr. Carr asked the President of the Board of Trade whether the standard period of Export Credits Guarantee Department credit cover for all major aircraft types has now been extended to 10 years as recommended in the Plowden Report.

Mr. Jay: I would refer the right hon. Member to the Answer I gave to the hon. Member for Woking (Mr. Onslow) on 31st January. The Export Credits Guarantee Department is ready to offer cover on all types of large civil jet aircraft on terms providing for repayment of credit over 10 years from delivery for creditworthy buyers and markets. [Vol. 740, c. 92.]

Mr. Carr: Does that mean that the HS748, for example, is now included in the 10-year credit terms?

Mr. Jay: The HS748 is not included in the 10-year provision, but the provision does include the 1–11, the Trident and the VC10.

Mr. Carr: Does that mean that the HS748 is not regarded as a major air-craft, or that the Government reject the Plowden recommendation?

Mr. Jay: It means that we are willing to carry out the normal matching facilities given by E.C.G.D. in any case where other countries make better offers than we do.

Concord Aircraft

Sir G. Sinclair: 19. Sir G. Sinclair asked the President of the Board of Trade whether he has decided which British airports may be used by the Anglo-French Concord; and what noise levels for take-off and landing he has requested the designers to keep to.

Mr. J. P. W. Mallalieu: Subject to the airport owner's consent, the Concord will be able to use any British airport which has adequate facilities, for example, runways of suitable length and strength. Airlines operating the Concord will be able to use any such airports provided they have the necessary licences from the Air Transport Licensing Board or, in the case of foreign airlines, authorisation from the Government. It is our objective that the noise levels of the Concord should at least not exceed those of present large jet-engined aircraft, and research is continuing to see whether further noise reductions will be possible.

Sir G. Sinclair: While I thank the Minister for that reply, may I ask whether that means that the Government are now firmly committed to getting the Concord into operation with airlines?

Mr. Mallalieu: Yes, Sir.

Mr. Brooks: Is my hon. Friend aware that no supersonic over-flights by military aircraft have been permitted in this country for many years? Will he give an assurance that the same policy will be applied to supersonic civil aircraft?

Mr. Mallalieu: I cannot give that firm assurance. But when leaving British airports, Concord will not fly supersonic until it is over the sea.

Aircraft Noise

Sir G. Sinclair: 20. Sir G. Sinclair asked the President of the Board of Trade whether he will now publish a White Paper explaining the main conclusions of the international conference on aircraft noise recently held in London, the British record in this field and his proposals for the future.

Mr. A. Royle: 72. Mr. A. Royle asked the President of the Board of Trade when he will publish a White Paper following the conclusion of the recent conference on aircraft noise.

Mr. J. P. W. Mallalieu: The conclusions of the conference will be found in the report which is to be placed in the Library of the House. These conclusions are fairly straightforward and do not call for a White Paper to explain them. I do not, however, rule out the possibility of a White Paper on the whole question of aircraft noise later in the year.

Sir G. Sinclair: I thank the Minister for that reply, but, he being responsible to the public for the control of aircraft noise, will he hasten the publication of a White Paper to put the public in possession of the full facts, not only on the results of the international conference, but on the whole problem, what the Government have done about it and what they propose to do about it in the light of the conference?

Mr. Mallalieu: I appreciate the importance of the hon. Gentleman's point, but I want to be able to make firm proposals on noise certification of engines before I publish the White Paper.

Mr. Hugh Jenkins: Does my hon. Friend appreciate that it is not merely a White Paper that is required but an actual reduction in aircraft noise? With that in view, can he say that he has looked at the proposals which I have made to amend my Bill to meet Government points, and will the Government give approval, or at least withdraw any opposition, to the Private Member's Bill that I hope to introduce on 28th April?

Mr. Mallalieu: Of course, the important point is not the production of White Papers but the reduction of noise. We shall achieve that by reducing engine noise, and that is a matter for research.

Mr. Hordern: 22. Mr. Hordern asked the President of the Board of Trade whether he will issue a general direction to the British Overseas Airways Corporation and British European Airways to insist on a considerable reduction in the level of engine noise in filling the requirements for any aircraft they may order.

Mr. J. P. W. Mallalieu: No, Sir. A general direction on these lines would not be appropriate or desirable.

Mr. Hordern: Is not the Minister aware that the United States Government have given 10 million dollars to the Douglas and Boeing Aircraft Companies to reduce aircraft engine noise? What comparable sums are being given to British companies for the same purpose?

Mr. Mallalieu: That is another question, but we want to encourage all companies, whether independent, publicly-owned or foreign, in this respect, that is the whole basis of our effort.

Mr. R. Carr: Would not this purpose be served by making sure that Rolls Royce gets maximum support for the development of its new technology on engine noise?

Mr. Mallalieu: Yes. I think it would, and the firm is going ahead very fast in this matter.

International Routes (Independent Airlines)

Mr. Onslow: 28. Mr. Onslow asked the President of the Board of Trade what action he is taking to encourage the development of international routes by British independent airline operators.

Mr. Wolrige-Gordon: 74. Mr. Wolrige-Gordon asked the President of the Board of Trade what further steps he is taking to develop international routes from airports in Scotland.

Mr. J. P. W. Mallalieu: It is for the airlines, independent or otherwise, in their commercial judgment, to apply for licences for international services whether from Scotland or from any other part of the United Kingdom. The Board of Trade can then seek to secure from the countries concerned proper scope for any new service that had been licensed. Full support is given to any new service that opens up a fresh market for British aviation, but the Board would not regard it as acceptable if recognition of the service could be obtained only on conditions detrimental to an established service or the British share of the market as a whole.

Mr. Onslow: Does the Minister not understand that the best encouragement he could give to these operators would be that of earning a profitable return? He penalises them by withdrawing investment allowances and the Air Transport Licensing Board artificially restricts their


domestic fares. How does he expect them to expand unless these factors are taken into account?

Mr. Mallalieu: This Question refers to licensing. It is a fact that many more licences have been granted than have been taken up.

Mr. Fortescue: Is the Minister aware that the Air Transport Licensing Board recently refused an international licence from Liverpool to Paris for an independent operator on the ground that it would interfere with the traffic run by B.E.A. from Manchester to Paris?

Mr. Malialieu: I am aware of that point, but I would not like to comment on it in case there is an appeal. It is our policy to avoid double designation.

Mr. R. Carr: Is the hon. Gentleman aware that my hon. Friend's Question refers to encouragement and not specifically to licensing? Will he at least undertake to remove the discouragement caused at present by loss of investment allowance which, together with S.E.T., must be adding at least a farthing per seat mile costs to these aircraft, which is a very serious loss in competitive power?

Mr. Mallalieu: As the right hon. Member knows, those questions should be addressed elsewhere, perhaps to the Chancellor.

VC10 Aircraft (Exports)

Mr. Hastings: 31. Mr. Hastings asked the President of the Board of Trade what steps he intends to take to assist further exports of the VC10.

Mr. Jay: In collaboration with my right hon. Friend the Minister of Technology, and with the support of Her Majesty's representatives overseas, I shall continue to take every opportunity to assist the sale of this aircraft abroad. E.C.G.D. facilities are available to cover exports of the VC10 on terms up to a maximum of 10 years post-delivery credit for credit-worthy buyers and countries.

Mr. Hastings: Is the right hon. Gentleman aware that one way in which to do this would be for the management of B.O.A.C. to publicise the full facts about the load factors of the VC10 as compared with the Boeing 707? Has not the VC10

turned out to be an aircraft which is outstandingly succesful economically? Why do not B.O.A.C. and the Government say so more clearly than they have?

Mr. Jay: I have said this repeatedly, long before the hon. Gentleman stated it.

Mr. Hastings: No.

Mr. Jay: I will give the hon. Gentleman the quotations if he likes. It is perfectly true that the VC10 has been outstandingly successful and B.O.A.C. has constantly paid tribute to it.

Mr. R. Carr: If it is so successful and if, as is obvious, B.O.A.C. is short of capacity, both now and as projected for the future, why did the Government allow the cancellation of the Super VC10 a year ago?

Mr. Jay: I have tried to explain that eight VC10s are coming forward and going into service with B.O.A.C., but the total number of aircraft which an airline wants must be in some way related to the traffic likely to be available.

London Airport (Landings)

Mr. Hugh Jenkins: 49. Mr. Hugh Jenkins asked the President of the Board of Trade if he is aware that landings on the main 28L runway at London Airport, Heathrow, the glidepath to which begins over the constituency of the hon. Member for Wandsworth. Putney, totalled 5,046 in January, 1967, compared with 1,146 in January, 1966, and that this is an increase of 340 per cent.; and if he will now take steps to reduce or remove this nuisance.

Mr. J. P. W. Mallalieu: The increase occurred partly because the number of westerly landings in January, 1966, was only 40 per cent. of the total landings at Heathrow compared with 83 per cent. in January, 1967—this was mainly due to wind conditions—and partly because the proportion of landings on 28R in January, 1966, was very much higher than usual because the ILS on 28L was out of action. The figures quoted by the hon. Member do not, therefore, indicate a trend towards making a greater relative use of runway 28L.

Mr. Jenkins: Is my hon. Friend aware that, although these figures show this up at its most extreme, intentionally so, the


frequency is increasing very rapidly indeed, and that frequency is a very important factor in the matter of public tolerance to noise? Will he further take note that in a previous supplementary question I mentioned the Aircraft Noise Bill on 28th April? The correct date should be 14th April.

Mr. Mallalieu: A system of parallel landings is being introduced at Heathrow. This, I hope, will equalise the use of these two runways.

Mr. A. Royle: Is the Minister aware that there is great public concern at the Government's tardiness in bringing in new regulations in order to ease the amount of noise caused by aircraft coming in to land at London Airport? What is the result of his inquiry into new operating procedures which I have suggested to him in several letters over the last month?

Mr. Mallalieu: We are doing a certain amount about the limitation of night flights, for example, at Heathrow. We are still studying the proposals to which the hon. Gentleman refers.

Mr. Royle: In view of the unsatisfactory nature of the Minister's reply, I beg to give notice that I will raise this matter on the Adjournment at the earliest possible moment.

AGRICULTURE (ANNUAL REVIEW)

The Minister of Agriculture, Fisheries and Food (Mr. Fred Peart): With your permission, Mr. Speaker, and that of the House, I should like to make a statement about this year's Annual Agricultural Review, the details of which are in a White Paper available in the Vote Office.
This year, in the Review, the Government have considered what progress has been made in the selective expansion plan. This is more important than ever. Last year's difficulties make it even more necessary to secure all the import savings we can from our farmers.
Broadly, the arable side, particularly cereals, is expanding in line with the programme. The livestock side, particularly meat, is making less satisfactory progress. Overall, net output is tending to decline. While the labour force is falling rather faster than in the programme, the decline in output means that

the industry's productivity is rising more slowly than we had hoped.
The Government have kept fully in mind the requirements of prices and incomes policy. While the particular criteria to apply from 1st July are still under consideration, it is clear that there will be continuing need for moderation in regard to prices and incomes. On the other hand, more needs to be done to help agriculture fulfil the programme.
We have always recognised that agriculture must have the physical and financial resources required to increase output and productivity in accordance with the programme. We have recognised, also, that farm income is a main source of the finance for any further investment the industry may need to make.
For the industry as a whole net income has remained virtually unchanged during the last three years. The forecast for 1966–67 is £472 million, almost the same as last year and slightly below 1964–65. Costs have increased by £15½ million. This figure does not allow for any increase there may now be in fertiliser prices, but we have allowed for this in our determinations. Against these cost increases must be set the industry's rising productivity, estimated—taking one year with another—at about £30 million.
Our conclusion, after weighing these factors, is that the industry needs an increase in income to finance further investment, particularly on the livestock side, and that it should get this in the national interest. If not, the expansion programme will fail.
The programme puts particular emphasis on beef. The beef herd has been expanding, but falling market prices last autumn produced some lack of confidence. The dairy herd, from which two-thirds of home produced beef comes, is static. Further incentives are needed. We shall increase the guaranteed price for cattle by 5s. a cwt., the calf and the beef cow subsidies by £1 a head, and the hill cow subsidy by £1 5s. a head. These incentives cover all stages of production from rearing to fattening.
To encourage expansion of the dairy herd we are increasing the guaranteed price of milk by 1½d. a gallon, inclusive of the increase in the standard quantities on account of the rise in liquid consumption. The retail price has to go up to


10d. a pint on 2nd April to pay for increased distributive costs and last year's Price Review award. With this year's award we should expect to keep it at 10d. until April, 1968.
The sheep breeding flock has recently fallen. Since an increasing share of the ewes must come from the hills and uplands we are increasing the rate of hill sheep subsidy by 2s. to 21s. This higher rate will apply not only to flocks maintained during the current year, but also for 1967–68. In addition, the subsidy will be extended to bring in about 2 million more ewes in flocks further down the hill. Subsidy on these ewes will be at 10s. 6d. Winter keep subsidy payments will be correspondingly extended. Finally, we shall increase the guaranteed price for fat sheep by 1d. a 1b.
The pig breeding herd has fallen during the last two years. The decline has now been checked, but pigs are well below the level needed. We are increasing the middle band—in effect, the standard quantity—by 400,000, as I announced last September, and increasing the guaranteed price by 8d. a score. We are also adjusting the flexible guarantee arrangements to give a stronger incentive to get production up to the required level, and encourage greater stability thereafter. The result of all this is to increase immediately the effective guaranteed price to producers by 1s. 11d. a score. Quality premiums will cease to be paid, as announced in last year's White Paper.
Production of eggs has over the year as a whole outrun demand. The guaranteed price will be reduced by ¾d. a dozen.
Cereal production is expanding satisfactorily. The growth in consumption justifies an increase in the standard quantities by 100,000 tons for wheat and 500,000 tons for barley. Since barley is outrunning wheat, we are increasing the guaranteed price of wheat by 6d. a cwt. and reducing barley by 7d. The net effect is no change in the cereals guarantee. We are increasing sugar beet by 2s. 6d. a ton. There is no change for potatoes.
The grant under Part I of the Ploughing Grant Scheme will be discontinued. The fertiliser subsidy will be reduced by a little under £2 million a year. We do this after considering all the circumstances, including the recommend-

dations of the National Board for Prices and Incomes; the high cost of the subsidy; and the fact that special grants for fertilisers will be available in the hills and uplands after the Agriculture Bill has become law.
The net effect of these changes is to increase the value of the guarantees by just over £25 million. This gives full recoupment for the agreed cost increases, together with a further £10 million, and leaves with the industry the whole of the estimated £30 million gain from increasing productivity. The Government could, consistently with the assurance on productivity given at the 1966 Review, have permitted the industry to retain only a part of its productivity gain.
We have decided that it is right, in the exceptional circumstances of this year, to go beyond this to provide the means for a further substantial investment in agriculture. I firmly believe that, provided farmers respond to the capital injection given at this Review, output and income will resume their upward trend and, most important of all, the industry will be able to make an even greater contribution to the nation's needs.

Mr. Godber: Is the Minister aware that the statement to which we have just listened shows that the Government now acknowledge the truth of the criticisms which we on this side of the House have been advancing for many months, and against which hon. Members opposite voted only a short time ago? He has admitted that the Government have brought stagnation to agriculture, and now appears, at last, to be trying to do something about it. To that extent, I welcome his statement.
Can the right hon. Gentleman answer one or two questions? Does he still accept the targets of the National Plan, and does he expect that this award will enable those targets to be achieved? Can he tell us why he has chosen to spread the increases on beef so wide, when a larger award on the end price would have had a greater impact? Why has he announced a cut of £2 million on the fertiliser subsidy at the same time as approving a 6 per cent. rise in fertiliser prices? Will that not be a bitter discouragement to farmers to use fertilisers, at a time when their increased use is essential?

Mr. Peart: The right hon. Gentleman is rather disappointing today—"Woe Joe". The Review is a means whereby we shall achieve a target which we have set for 1970. The National Plan remains intact. We believe that the Review will provide the capital which is needed. This is the best Review since 1948. It is an agreed review, and it will fulfil the objectives.
On the right hon. Gentleman's question about beef, it was right to help the fattener at all parts of the production chain.
As the right hon. Gentleman knows, the fertiliser subsidy was running at a very high rate. We took note of what could emerge from the Prices and Incomes Board. But, in the circumstances, I think that what we have done is very reasonable.

Mr. Emrys Hughes: Would my right hon. Friend say how much of this £25 million will go into the pockets of landlords? How does he reconcile his statement that net incomes have remained the same for the last three years with the fact that, not so long ago, he told me that farmers' rents had increased, particularly in Scotland? Is he satisfied that he can maintain the level of milk production under the scheme?

Mr. Peart: Yes, certainly. I am anxious to help farmers to invest and see that we achieve a selective expansion programme, whether they be owner-occupiers or tenant farmers, so that I do not think that the argument about static incomes applies. I am anxious to provide the income and, out of that, the necessary investment. The increase of 1½d. a gallon on milk will help us to get the dairy herds going, because, in the end, the dairy herds provide two-thirds of our meat needs.

Mr. Turton: Is the right hon. Gentleman aware that the Chairman of the Egg Marketing Board has declared already that any cut in the price of eggs will have a disastrous effect next autumn for housewives, for producers and also for our balance of payments?

Mr. Peart: I know, and the right hon. Gentleman has pressed me on imports. But we cannot allow output to outstrip demand. What we have done is reasonable in the circumstances, and I am glad

to say that it has been accepted by the producers.

Mr. Elystan Morgan: Will my right hon. Friend accept that the rise in the price of milk will be welcomed by milk producers, especially those in Wales, where the cost of production is between 3d. and 4d. a gallon higher than it is in the rest of Britain? Will he not close his mind to acknowledging the differential in production costs at some time in the future?

Mr. Peart: The award of 1½d. on the guaranteed price has been accepted by producers. It will be of great benefit to producers in both England and Wales. I will take note of what my hon. Friend has said.

Mr. Alasdair Mackenzie: Is the right hon. Gentleman aware that we on these Benches welcome the Review as an agreed one? We note that at last the Government have realised that farmers are in a difficulty and that they cannot possibly contribute to import saving in the way which is within the capability of the industry unless they have some capital. We also welcome the help given to hill and upland farmers, because we realise that, without something of this nature, many of them will quit the hills and uplands during the course of this year. We think that—

Mr. Speaker: Order. We are all very fond of the hon. Gentleman, but he must ask a question.

Mr. Alasdair Mackenzie: Is the Minister aware that the 5s. per cwt. increase on beef is not a sufficient incentive? Is he also aware that in the opinion of the egg producers, his proposal is a very weak one and—

Mr. Speaker: Order. I think that that is enough for the Minister to be going on with.

Mr. Peart: I have explained about beef and eggs, but I am glad that the spokesman for the Liberal Party today has shown much more objectivity than the spokesman for the Conservative Party.

Mrs. Braddock: Can my right hon. Friend say what the effect of his Price Review will be upon the housewife?

Mr. Peart: Certainly. I believe that it will stimulate home production. We


must always remember that, under the present system, we produce food at cheaper prices than any other industrial country in Europe.

Sir H. Legge-Bourke: Is the right hon. Gentleman aware that, although the increase in the sugar beet price is to be welcomed, the tiny increase in wheat, offset by the considerable reduction in the price of barley, will cause great dismay in East Anglia? Will he recollect that, only recently, the Chairman of the Potato Marketing Board expressed concern about the acreage now being planted for potatoes? Why has the price remained the same?

Mr. Peart: I cannot accept what the hon. Gentleman says. In my statement, I explained fully the position as regards barley and wheat. I think that we have struck the right balance. Guaranteed prices have been adjusted, and there is an increase in the standard quantities. For potatoes, there is no change, but this should not give rise to dismay, because the producers have accepted it.

Mr. MacLennan: Will my right hon. Friend accept that we on this side of the House are very satisfied with the Review and, in particular, with what he has done for the hill section—the hill sheep subsidy? Will he answer two questions about it? First, in the event of the hill sheep section of the industry not recovering entirely during the course of this year, can there be a further increase in the subsidy despite the fact that he has fixed it for two years ahead? Secondly, can he say on what principle the extension down the hill is to be made for this new subsidy of 10s. 6d.?

Mr. Peart: I must not go further than what I have done. The award is considerable. We have given direct help to the farmers. The hill cow subsidy goes up by £1 5s. The hill sheep subsidy is increased by 2s. We are moving forward the date of payment of the hill sheep subsidy so that, in 1967 and 1968, farmers will get payments in respect of both 1966 and 1967. As the hon. Gentleman said, we are extending the hill sheep subsidy to a wider area.
Also of importance to Scotland is a corresponding extension in the winter keep

subsidy. All these measures, especially the higher calf subsidy, are a considerable step forward. I would rather that he judged now what we are doing. If there is any change, I shall always look at it.

Mr. Stodart: Is the right hon. Gentleman entirely satisfied, glad as I am to see the ewe subsidy going downhill, that the sector is getting the encouragement it deserves, when it is compared with what he has done for the beef sector of the industry, particularly in view of the terrible year, and months before, which the sheep industry has had?
Secondly, can he say how much of the award is coming to Scotland out of the £25 million? I notice in the White Paper—something which he did not touch on—the new grant for beans as a break crop. Can he say whether he gave any thought to encouraging rape?

Mr. Peart: We shall have consultation with the unions about break crops and field beans and will consider rape very carefully.
On the question of Scotland, the proportion of the award is about one-eighth of the £25 million. The proportion of the U.K. farm output in Scotland is one-ninth. That is reasonable. As to how the award for ewes compares with the help given to beef, I would say that we are not here comparing like with like. What we have decided is sensible and wise, and I hope that it will be accepted. The producers will welcome it.

Mr. William Edwards: Is my right hon. Friend aware that, as we have a subsidy-based agricultural industry, any increase in the subsidy will be welcome? Is he also aware that the level of profitability on beef, even with its increased price, is not sufficient to divert small farmers from milk production into beef production, which is what the National Plan calls for?

Mr. Peart: My hon. Friend must bear in mind that the small farmer will benefit, particularly from the emphasis which I laid on milk and pigs. They are typical products of the small farm. I think that the Review will help very considerably many small farmers.

Mr. Kimball: Is the right hon. Gentleman aware that many forward-looking farmers will be disappointed that he has


not used this agreed Award to bring our support price system more in line with the support price system practised in the Common Market? The Minister is tinkering about with subsidies and production grants and most of us will realise that his well-known bias against the Common Market is obvious in the Review?

Mr. Peart: I am rather surprised at the naïve—naïve in the sense of farming—and malicious question of the hon. Gentleman. No hon. Member can really suggest that, in a Review of this kind, we could have the prices that operate in the Community. It would be absurd to try; one could not do it. This is a very generous and wise Review. It is also the best since 1948. I take the view about the Common Market that we should make our agricultural industry strong, viable and competitive, so that whether or not we go into the Market the industry can stand on its own feet. That is what I want. I have always argued that we should negotiate from strength. I want us to have a strong and prosperous industry, and this is what I am seeking to bring about.

Mr. Tony Gardner: Will my right hon. Friend accept that despite the somewhat obvious difficulties of the right hon. Member for Grantham (Mr. Godber), the whole House will welcome the fact that he has an agreed Review this year? On the question of the injection of capital into agriculture, can he say to what extent he bore in mind, in making the Review, the need to encourage the development of agricultural co-operatives?

Mr. Peart: Not so much specifically in the Review. As my hon. Friend knows, in my Agriculture Bill, which is before Parliament, I have a special Clause on producer co-operation. I believe that all farms which may be involved in a producer co-operative will benefit from the Review. The Bill is designed to give the special aid which is required by producer co-operatives.

Mr. J. E. B. Hill: Is the Minister aware that although the increase in income is undoubtedly welcome, it will not necessarily result in increased long-term capital investment? That must depend on confidence. Would the

Minister agree that at the moment farmers do not yet have confidence in what he may or may not do in two or three years' time?

Mr. Peart: I can only point out what the N.F.U. Council resolution states. It says:
This Review is a genuine attempt to provide the industry with the additional capital resources currently required for the progress of the selective expansion programme.
The producers believe that this Review is sensible and for this reason it gives confidence to the industry. I hope that hon. Gentlemen opposite will cast aside their political prejudices, will be objective, and will recognise that this is a fair Review.

Sir G. de Freitas: Is my right hon. Friend aware that although both beef producers and consumers will agree that this is a sensible price Review, what worries the beef producers in my constituency is the possibility of a depression in the cattle trade such as we had last year. Will he bear that in mind?

Mr. Peart: Certainly. My right hon. Friend is perfectly correct. When I spoke in the major agricultural debate, I dealt with the importance of marketing in particular, and the phasing of supplies upon our own markets. Irish supplies had been affected by the levy in the Community, and these were, therefore, beamed to this market. I am following this up actively. I recently went to Dublin to discuss this with my counterpart. It is an acute problem.

Mr. Godber: Following up the points made in the last two or three supplementaries, and particularly on the question of confidence, does the Minister recognise that the confidence of many farmers is seriously impaired in regard to the imports which are diverted here by reason of the activities of the Common Market? Did he have any discussions with the National Farmers' Union about any restriction or control of imports which might be necessary if he is to get the required expansion?

Mr. Peart: The right hon. Gentleman well knows that I cannot reveal, in question and answer, what happened during negotiations. It would be a breach of confidence.
I am aware of the problems affecting the industry. The question of imports


and orderly marketing is beyond this Review. I recognise that there is a problem—as I have always said. The tragedy is that the right hon. Gentleman never once thought of it.

Mr. David Griffiths: May I ask my right hon. Friend, not so much that the big farmers opposite cannot look after themselves, but what benefit will accrue to the small farmers from this Review? Furthermore, what difference is there between the Review of this year for the small farmers compared to what they were in the years hitherto?

Mr. Peart: The small farmer will particularly benefit by the emphasis we have put in the Award on milk and pigs and, indeed, by the general Award. It will help many small producers. Comparing this Award with previous Awards, this is the best since 1948. Unlike hon. Members opposite, we do not need the stimulus of a General Election.

Sir J. Gilmour: May I ask the right hon. Gentleman whether he is satisfied that as a result of his Review our refreshment department will no longer be interested in buying Danish eggs?
In any consultation with the Secretary of State for Scotland, is he satisfied that the 15,600 acres of sugar beet allocated to the Cupar sugar factory will be taken up as a result of the price increase in this award?

Mr. Peart: The question which the hon. Gentleman has asked me about the refreshment department should he addressed to the new chairman.
I am anxious about the Cupar factory and so is my right hon. Friend the Secretary of State for Scotland. I hope that the acreage will be taken up. We will bear this in mind. I shall be in close touch with my right hon. Friend.

Mr. John Hynd: Is the Minister aware that this award will not necessarily be universally welcomed, particularly as he himself has claimed with some justice that our agricultural industry has made remarkable progress over the last 20 or 30 years? It will be very difficult for many people to understand why we can pour out this largesse to big farmers at a time when we are restricting other incomes, and asking workers in other

industries to hold up their pay claims. Will he not consider the merit of the principle so often pressed by members of the Opposition, and see that this lavish outpouring of national assistance goes only to those in real need?

Mr. Peart: I strongly resent my hon. Friend's remarks. There is no question of national assistance. This is an attempt to give the industry capital for investment, and this is right. There is always a risk in farming. My hon. Friend wishes to increase prices further because of certain policies. I am rather surprised at him. This is a reasonable, sensible Review. I defend it, and I resent childish remarks like those of my hon. Friend.

Sir Frank Pearson: I welcome many parts of the right hon. Gentleman's Review, but will he recognise that his reduction in the subsidy for eggs will place a great number of smaller egg producers in a very difficult position? Will he give the House an assurance that he will keep a very close watch indeed on the results of this part of his Review as it affects the smaller egg producers?

Mr. Peart: As the hon. Gentleman knows, I watch how the Review affects production. This is why I took action on the question of pigs—I am talking about the middle band—before the Review. I have noticed the progress of egg production, but I gave the reasons for the cut. I think that it is sensible in the circumstances, but, obviously, I shall watch the situation carefully as we go on.

Mr. Hector Hughes: I congratulate my right hon. Friend on the comprehensive scope of his Review, but may I ask whether he realises that there is one class of food producer who has not received enough attention yet, namely, pig producers in the North of Scotland, who are suffering from competition from Danish pig producers? Will he consider this with a view to giving them some help?

Mr. Peart: As I said in my statement, pig producers, and those in the North of Scotland, will get 1s. 11d. more a score. This is a tremendous incentive, and I hope that it will bring joy to my hon. and learned Friend.

Mr. Grant-Ferris: Is the right hon. Gentleman aware that 1d. per lb. on the price of mutton will bring some satisfaction to sheep farmers, but that 4d. per lb.
was much more likely to be accepted as something which would be a fair minimum which the industry ought to have to enable it to pick up?
Worse than that, is it not a fact that something should have been added on the price of wool because in these days of declining flocks it is better to put something on wool so as to keep up the flocks?

Mr. Peart: The hon. Gentleman can say that I should have made it 4d., or 5d., or 6d. but he must realise that in the circumstances I was quite right. I could not go beyond what I have done.
There is no change in the wool position. We are having further discussions with the unions.

Mr. McNamara: Will my right hon. Friend accept that we on this side of the House accept his Review as being a spendid effort and a further example of his determination to increase the strength of the agricultural industry, whether we enter the Common Market or not?
I have one or two specific questions to ask my right hon. Friend. First, can he say more precisely what effect this Review will have on the housewife's purse? Secondly, as we are increasing the production of barley, but reducing the subsidy, what effect will this have on barley exports, particularly to the Common Market. Thirdly, can he estimate what effect this will have—

Mr. Speaker: Order. That is a reasonable amount of questioning.

Mr. Peart: I think that I dealt with the general effect on the consumer in relation to the importance to him of efficient production, but there are direct effects. Milk is an example, because the increase in its guaranteed price will go on to the consumer. I have the figures here. They show that ½d. a pint on the retail price is equal to about 0·13 of a point in the all-items index. I think that this is reasonable. The price will remain at 10d. a pint right up to April of next year.
I cannot say what will he the direct effect on barley. It is impossible to estimate, as so many other commodities are affected. However, I think that,

broadly, the Review will affect the consumer, as it does the producer.

Mr. Peter Mills: Will the right hon. Gentleman bear in mind that this reasonable Price Review is due entirely to the very strong lobbying from this side of the House, and that we are very pleased that it has now got through to him and to the Treasury?
In view of the cut in fertiliser subsidies, will the right hon. Gentleman watch the trend in the use of fertilisers, because it would be wrong to allow farmers to draw on their fertility banks?

Mr. Peart: We will certainly watch the use of fertilisers. I am glad that the hon. Gentleman is changing his tune and really welcomes the Review as being reasonable. I assure him that hon. Gentlemen opposite played no part in this.

Mr. James Johnson: I welcome my right hon. Friend's Statement. I do not think that even the fabulous Tom Williams, as he then was, could have done better in these difficult times.
In view of the snide comments of the farmers' lobby on the benches opposite, may I ask my right hon. Friend what communication he has had from genuine farmers and the N.F.U. on this first-class Review?

Mr. Peart: I hope that my hon. Friend will not think that hon. Gentlemen opposite, while they have their lobby, really represent the views of farmers, because when the Tory Party was in power it continually let the farmers down. We have sought to give the farmers long-term objectives, and this Review is an example of that. The N.F.U. Council regards the Review as
a genuine attempt to provide the industry with the additional capital resources currently required for the progress of the selective expansion programme.
In other words, the farmers are much more objective than the political bigots opposite.

Mr. Farr: At the risk of being called a political bigot, may I ask the right hon. Gentleman whether he is aware that most hon. Members in the House are delighted that after three years he has at last shown some sense of responsibility in the position which he


occupies? May I also ask him whether he is satisfied that what he has done for beef is the right thing, and whether more emphasis should not have been put on the end product? Furthermore, may I ask whether some form of import saving plan can be drawn up to prevent the see-saw which we have had during the past year?

Mr. Peart: As I have said, import phasing is a matter at which we always look and discuss with those concerned. This is an important issue. We have always had a traditionally free market. The hon. Gentleman's proposals would mean a departure, but I will bear it in mind. I have replied on the question of beef. I think that we must have a wide spread. This is a matter of judgment. I took the advice of experts, and I am glad to see that it has been confirmed by the producers.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Order. We must move on.

BILL PRESENTED

COMMONWEALTH SETTLEMENT

Bill to extend the period for which the Secretary of State may make contributions under schemes agreed under section 1 of the Empire Settlement Act 1922, presented by Mr. Herbert Bowden; supported by Mr. Gunter, and Mr. Niall MacDermot; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 212.]

LONDON SCHOOL OF ECONOMICS (SUSPENSION OF STUDENTS)

Mr. Brooks: On a point of order. I beg to ask leave to move the Adjournment of the House under Standing Order No. 9 for the purpose of discussing a definite matter of urgent public importance, namely,
the suspension today of 102 students at the London School of Economics for three months.
The events at the L.S.E. during the last three or four months have caused mounting anxiety and apprehension among large sections of the community, and not least among Members of the House. The House is well aware of the real danger of appearing to Intervene in matters which appertain to academic freedom, but the events of today which have been disclosed in the Press—

Mr. Speaker: Order. The hon. Member must not address himself to the merits of the issue he seeks to raise.

Mr. Brooks: I fully accept your Ruling Mr. Speaker.
I was about to refer to the news which has appeared today and been published in many papers that, as a result of certain altercations and disturbances in the early hours of this morning, 102 students at the L.S.E. have been suspended for three months.
I am sure that this is a matter which is definite, and it is perhaps almost certainly definite that it will have yet wider repercussions. I am sure that it is urgent, because as a result of these repercussions it will affect many other universities in a matter of hours. It is a matter of public importance. It has been apparent for many days that the Press has ventilated public concern at the events which have led up to this suspension.
I do not wish in any way even to imply a judgment upon the merits of this action, but I am asking that on this issue, on which Parliament has argued that it has no discretion, there is now, as a result of this suspension, an obvious problem, not least affecting the grants which, presumably, will either be paid or not paid to the students so suspended. To the extent that that is the responsibility of both national and local government, particularly in giving advice to local education authorities, I


would urge that this matter be ventilated by debate in the House to see whether an independent inquiry should be carried out into the merits of the dispute at the London School of Economics.

Mr. Speaker: The hon. Member for Bebington (Mr. Brooks) asks for leave to move the Adjournment of the House for the purpose of discussing a definite matter of urgent public importance, namely,
the suspension today of 102 students at the London School of Economics for three months.
What the hon. Gentleman is asking is that we suspend the consideration of the debate set down today for a period, so that we may discuss under Standing Order No. 9 the matter which he seeks to raise.
Among the Rules which regulate Adjournment debates under Standing Order No. 9 is that which declares that the subject matter must involve the administrative responsibility of the Government. The precedents show that Motions have been disallowed because the matter raised was one for which another authority was immediately responsible.
For example, if a local authority, a provincial police authority, a statutory authority, or a judicial authority is more directly responsible than the Government of the day, then the Motion for the Adjournment under Standing Order No. 9 cannot be invoked. In present circumstances, it is clear that the application for leave to move the Adjournment under Standing Order No. 9 has to be refused, because I am bound by the precedents to take that course and I cannot put the hon. Gentleman's application to the House.

BUSINESS OF THE HOUSE> (SUPPLY)

Ordered,
That this day Business other than the Business of Supply may be taken before half-past Nine o'clock.—[Mr. Gourlay.]

Orders of the Day — SUPPLY

[14TH ALLOTTED DAY] [2nd Series],—considered.

Orders of the Day — DEFENCE (AIR) ESTIMATES, 1967–68

Vote 1. Pay, &c., of the Air Force

Motion made, and Question proposed,
That a sum, not exceeding £146,580,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the pay, &amp;c., of the Air Force, which will come in course of payment during the year ending on the 31st day of March 1968.

4.13 p.m.

Mr. Victor Goodhew: Having had debates on the Estimates of the three Services over the last two weeks, we now meet to vote the money for those Services. We debate all the Services in one day and this is a short enough time. Experience shows that we seldom have time to debate all three. It is, I understand, the custom not to suspend the Ten o'clock rule, which means that, today being a Wednesday, we shall finish at 9.30 p.m. Having had a late start, there is rather limited time, which will mean that it will be more reasonable to ask questions rather than to probe the sums involved in detail and depth, as one might like.
Such is the presentation of the Estimates that it is not easy to go into detail at any time. As we had our debate on the Air Estimates only yesterday and the Under-Secretary's winding up speech is not even on the record yet, it has not been easy for us to give him notice of any matters which we may want to raise, but I am certain that any of my hon. Friends who ask questions will understand if he writes to them rather than answers across the Floor.
My first question on this Vote concerns the University Cadetship Competition. I see from page 68 of the White Paper that the average annual target is 67, but that during the past year only 37 awards were made, plus, after an autumn subsidiary competition—presumably to help to increase the numbers—five more. There is now, therefore, a


total of only 42 for last year, compared with the normal average of 67, and I wonder whether the Minister can give an answer to that.
On the subject of the recruitment of commissioned officers, we notice that the number of navigators is still slightly short of target and that all the main ground branches are running about 25 per cent. short even now. We are told that in the engineering branch the number of graduates and professionally qualified people is very disappointing. Is this due to the uncertainty about which I spoke yesterday?
I was encouraged to see that many more young airmen are successfully obtaining commissions in direct competition with civilian interests. This is always a good thing for the Service, and those who join in the ranks should know of this opportunity and the success which so many achieve. It is welcome news. One wonders whether it would not be possible to make good the shortage of which I spoke in the main ground branches in the same way, as this would encourage further recruitment.
Is there any anxiety about the rate of pay in the commissioned ranks? On 18th March, 1963, the right hon. Member for Sheffield, Park (Mr. Mulley) complained bitterly that my party had delayed an increase of pay for the Services which had been agreed by the Grigg Committee, by giving only half the increase in one year and delaying the other half until the next. For a party which complained of such action when in Opposition, the present Government have behaved peculiarly, because they went further and referred the increase in pay and allowances to the Prices and Incomes Board, which was an extraordinary action.
I wonder whether the Prices and Incomes Board is qualified to decide matters connected with Service pay, which has been the subject of a special committee's inquiries over a long period. If the Board wishes, it can recommend a standstill. I cannot help feeling that there may be some anxiety among the people in the Forces and those who might otherwise join, lest they find that the prospects held out to them did not materialise, simply because, as a result of this Government's policies, increases which they would normally get were referred to the

Prices and Incomes Board and they did not receive them at the appropriate time. The Government are clearly not conscious of the difference between the Armed Forces and the civilian employees in this respect.
Re-engagement is very much a part of the same subject. The White Paper says, on page 70:
Interest in re-engagement and, to a lesser degree, extension of service increased in the spring of 1966, following the Defence Review and the pay increase announcements. The improvement has not been maintained.
This shows that I was right to point out yesterday that while there had been this optimism in the Services in general, and the R.A.F. in particular, when the Defence Review appeared—because the men assumed that they would have settled conditions, that the R.A.F. would know the rôle it would have to play and that it would be given the appropriate arms and weapons to perform that rôle—the truth has gradually dawned on people, who have realised that there is still no certainty about the future of the Forces, of the rôles of the Services and of the rôle of the R.A.F. in particular.
I gather from Annex A that the active strength of airmen, to put it that way, was 101,000 at 1st April, 1966, that the estimated strength is 98,000 for 1st April of this year and that it is estimated that the strength will be 96,500 on 1st April, 1968. We know that the R.A.F. is being run down and, therefore, these estimates do not surprise us. Nevertheless, do we have the right number of men available in the right trades? If the Service is to continue to be run efficiently, it is vital that a correct balance is maintained. These figures of strength, recruitment and re-engagement mean nothing unless one is able to make an analysis to decide whether we have sufficient men in each trade.
This brings me to a constituency case about which I have written to the Minister in the last two days. It illustrates the type of difficulty that arises. In this case a man, in the position of clerk statistician, entered the R.A.F. as a boy entrant at the age of 15½ and at that time signed on for 12 years as from his 18th birthday. Now aged just under 21, he wishes to purchase his discharge. He has been informed that his trade is 100 per cent. manned, but that that is not sufficient because the Service would require


his trade to be 105 per cent. manned before he could be released. I appreciate that a trade in the R.A.F. must be more than 100 per cent. manned to enable the Service to release those wishing to leave, since it must not be run down in strength by undermanning the individual trades. However, is 105 per cent. the correct figure? Since it is planned to run down the Service in any event, is there not scope for giving accelerated opportunities to people who wish to purchase their discharge?
Under Vote 1 (E.) are sums for the Royal Air Force (Malaya) and Royal Air Force (Malta). This Vote is headed
…Pay, &amp;c. of Royal Air Force Corps Abroad".
The word "Corps" struck me as unusual, used in a R.A.F. context, and confused me for a moment. I was particularly interested, bearing in mind what is going on in Malta today, to note that the figure for the R.A.F. Corps in Malta is up from £220,000 to £225,000 for the coming year. In view of the difficulties that are a manifestation of the Government's desire to reduce our forces in Malta, I was surprised to see an increase in that case.
Under Vote 1 (Z 1) appears a figure for
Receipts in respect of personnel lent to other governments".
This is down by about £330,000, or about 17 per cent., on last year's figure. What does this indicate? Does it mean that fewer R.A.F. personnel are being allowed to help train Commonwealth air forces, or is there another reason? Surprisingly enough, Vote 1 (Z 3) shows, under the heading "Other receipts" that these receipts are up from £760,000 to £1,670,000. This is an increase of more than 100 per cent. and I wonder why it is so much higher. I am not sure what is included in the heading "Other receipts" and whether it contains money paid by people purchasing their discharge. From the experience of my constituent, I would not be at all surprised if that were so; and I hope that the Minister will give us more information on this issue.
Commenting on the Royal Defence College and the way in which it will affect the Air Force, the Under-Secretary said yesterday:
What this means for the Royal Air Force, for Cranwell, is that officer cadets for the

General Duties, Equipment and Secretarial Branches and for the R.A.F. Regiment, will start training at Cranwell. After they have completed general military training and gained either their wings or completed equivalent professional training, they will go for one year's academic instruction at the Royal Defence College, together with young officers of about the same age from the Royal Navy and the Army.
Those young officers who are capable of taking university degrees, and who wish to do so, may remain at the Royal Defence College for a further two years to complete their course and to graduate. Those officers who do not wish to take degrees and those who have graduated will return to the Royal Air Force for advanced flying or equivalent professional training before joining operational units."—[OFFICIAL REPORT, 14th March, 1967; Vol. 743, c. 257.]
This compares somewhat strangely with the arrangements announced by the Under-Secretary of State for Defence for the Army, who talked about the Army sending men to Sandhurst for one year and then to their regiments for two years, and then going to the Royal Defence College. For how long are R.A.F. cadets to wait before they, too, can go to the Royal Defence College? If the Army is doing one year at Sandhurst and two years with a unit, one can hardly see an R.A.F. cadet joining up with his fellow men of the same age-group—

The Minister of Defence for Administration (Mr. G. W. Reynolds): They will be a year younger.

Mr. Goodhew: I am grateful for that information. It presumably means that R.A.F. cadets will have two years at Cranwell and will then go to the Royal Defence College.

Mr. Reynolds: Mr. Reynolds indicated assent.

Mr. Goodhew: What are the final arrangements likely to he about flying training for officers who, presumably, will by then have left Cranwell and have been commissioned? The Under-Secretary said yesterday, in response to an intervention from my hon. Friend the Member for Macclesfield (Sir A. V. Harvey):
What is envisaged is refresher training, perhaps in association with a university air squadron. I will look into that aspect ".[OFFICIAL REPORT, 14th March, 1965; Vol. 743, c. 258.]
Perhaps this is too soon after the hon. Gentleman made that comment for him to give more information on this aspect.
This is a matter of great importance because there should be opportunities, during the period at the Royal Defence College, for pilots to continue their flying at a reasonable rate so that they do not lose their touch. If there is one thing essential in flying, it is to keep at it throughout one's flying career.
Those are the main questions that I should like answered. Some of them may be difficult for the Under-Secretary to answer today, but if he has to notify us later I shall quite understand.

4.30 p.m.

Mr. Tim Fortescue: In yesterday's debate I was able to ask two questions about Royal Air Force numbers, and before the end of the debate the Under-Secretary of State gave me the answer to one of them. I would, however, ask him now to clarify that answer; it was a little late at night, and he may have rather more information now. The hon. Gentleman said that the apparent discrepancy in numbers appearing in the Defence Estimates was due to the fact that overseas personnel were included in one case and not in the other. What does the hon. Gentleman estimate the total strength of United Kingdom personnel will be on 1st January, 1968—that is, the figure corresponding to the 124,300 for 1st January, 1967 which appears at the foot of page 66 of the Statement? With that figure we shall have an exact comparison, without the confusion of exclusion or inclusion of overseas personnel.
The other question that I asked, but which the Under-Secretary did not have time to answer, was whether the figure represents his best hopes or his fears of what the strength will be. Are the numbers more or less than he would like to see?

4.32 p.m.

Mr. Humphrey Atkins: I understood from an intervention from the Treasury Front Bench just now that Royal Air Force officers will go to the Royal Defence College after completing two years at Cranwell during which time they will be under training. From what we were told in the debate on the Army Estimates, they will there join Army officers who have had one year's training, and then two years

—perhaps two years of fighting—with their regiment doing normal duties. On the other hand, judging from that intervention a moment ago, R.A.F. officers will go straight from training to the College—as it were, straight from school.
That means that these two groups—and we do not yet know about the naval officers—will be very different. They will be different in age and, more particularly, they will be different in experience. From what we had been told earlier, we thought that the idea was to get people a little older, with a little more experience, before giving them this degree course or one-year course. It now transpires that this is not the case. The Under-Secretary should justify to the House the difference in treatment of Army and Royal Air Force personnel. As I say, we shall come later to the Royal Navy.

4.43 p.m.

The Under-Secretary of State for Defence for the Royal Air Force (Mr. Merlyn Rees): This is a curious debate, in that there is not time to be given notice of what are often very detailed questions. I am, therefore, grateful to the hon. Member for St. Albans (Mr. Goodhew) for what he said. I shall deal one by one with the points he has raised.
The university cadetship scheme which we run in the Royal Air Force is extremely important. In this age, when far more people go to the university, it is important that the Services should recruit their fair share of graduates. This has its bearing on what I will say in a moment about the Royal Defence College. The university cadetship scheme is now in its fourth year. There was a slightly different system in existence before that. Cadetships are awarded to selected candidates who have obtained for themselves a place at a university or who are already in residence. They are commissioned in the rank of Acting Pilot Officer, and while they are at university they are in many respects in a better financial position than are other students.
The need to attract more graduates into the Service has led to a gradual increase in the size and scope of the arrangements. The original scheme provided in 1963 for an average of 25 cadetships in the general duty and engineering


branches to be awarded annually. In January, 1966 we had a total of 57 cadetships in the general and engineering branches. For the main competition in 1966 the number of applications was the highest ever. There were 46 awards—48 were offered—against 43 in 1965. There are more people than that up at university. We would like more young men to get into this scheme, but the plain fact is that although there is a higher number than ever before, there is great competition, and we are by no means satisfied merely that the number is larger than it was in the previous year.
In the engineering branch one also meets competition from the civilian side. That is why it is difficult to recruit young men in the engineering branch directly. We get a small number coming in on the university cadetship scheme. I do not have the exact figures relating to the R.A.F., but even since my day it has had a very good record of commissioning N.C.O.s who are trained as engineers. I should have thought that during the war and just after it, as high a proportion as 90 per cent. plus of officers were commissioned from inside the Service. A great deal of that commissioning goes on. This subject was raised last evening by the right hon. Member for Stafford and Stone (Mr. Hugh Fraser), who recalled, no doubt from his days as Secretary of State in my Department, that recruiting then was in a different form.
One problem in the engineering branch is the promotion ladder whereby officers in that branch can feel that they can get up to two-star or three-star rank. As I assured the right hon. Gentleman last evening, this point is being looked at, because it is important that we should get this position right. I must say that this is one of the things I find especially gratifying in the Royal Air Force. I was in the company the other night of the Air Officer Commanding a Command who had joined the Royal Air Force as an apprentice way back in the late 1920s. Apprentices in the Service can eventually go through Cranwell, and there is a royal road to promotion—usually on the technical side—which is second-to-none to any.
Last year's increase in pay throughout the Service was not delayed by reference to the National Prices and Incomes

Board. The pay award made in April was exactly the same as that which had been decided under the Grigg formula. There may well be argument—and I know that the right hon. Member for Wolverhampton, South-West (Mr. Powell) feels strongly on the subject—about having an incomes policy at all, but if there is to be such a policy it is extremely important that those sections of the community which are not in a position to use bargaining strength should know that any award made elsewhere is also subject to scrutiny.
It may well be beneficial in the long run to have these awards looked at by an objective board or commission, as the result may well be a greater increase than was originally decided. The hon. Member for St. Albans smiles, but in many industries the pay structure is often out of tune with today's conditions. That happened in the case of the Board's Report No. 18 dealing with the industrial civil servants whom we employ. The pay structure had got out of true over the years, and that Report was extremely valuable. The point is that last year when it went to the Prices and Incomes Board it was fully endorsed. The problem which arose subsequently for medical officers did not arise out of the Grigg formula. The doctors equated themselves with the private medical profession, and this led to problems.

Mr. Goodhew: Would not the hon. Member concede the point which I made, that if it is desirable—and I do not necessarily say that it is—for these matters to be looked at by a body, the Prices and Incomes Board is not the right body? It is very unlikely that there are people on that board qualified to assess the need of one of the Services. This is where the hon. Gentleman, as the manager of the R.A.F., as he put it yesterday, should be worried about the possibility of it being assumed that this is the way in which it will be done. Does he not think that the Grigg Committee is a much better approach to the whole problem?

Mr. Rees: I take the point, but it is not the case that the Prices and Incomes Board determines the original award. This will still be done inside the Ministry of Defence. I have nothing to report at this stage to suggest that there will be any change in the procedure the next


time it arises. It is purely a question of going to the Prices and Incomes Board in exactly the same way as that in which the Board looks at most other major changes in prices and incomes. It is vital that men in the Armed Forces should not be treated differently in this respect from civilians.

Mr. Goodhew: Surely as the Minister in charge of a Service he accepts that a member of the Armed Forces is in a very different position from that of a civilian? I have come across the case of a person aged 21 who is in the R.A.F. for another nine years, whether he likes it or not. It is vital that somebody should be protecting his interests and that it should not be assumed that he is in the same position as a civilian who can give notice tomorrow and find another job.

Mr. Rees: The short answer is that the award made last year was extremely generous and took account of the fact that the men were not civilians and were in a different position from civilians. I will come to that point, for we must take account of it.
I was asked about re-engagement. The right hon. Gentleman was quite right in saying that last year after the Grigg award there was a sudden spurt of signing on. The carrot was the higher pay. They may also have been waiting for the pay. There was, therefore, more than a proportionate increase at that time. It is not a question of the truth suddenly dawning. There are difficulties in the modern Services, and particularly in the R.A.F., as a result of earlier marriages. There has been a great deal of what the Services call turbulence and unaccompanied tours abroad. There are different attitudes in the modern world from those of the past and it is extremely difficult to get people to sign on for longer periods. But this is not new. It has been developing over the years and we are well aware of it.
The hon. Member was good enough yesterday to say a kind word about my attitude on the personnel side. That attitude reflects only the very high standard which I have found in the personnel side of the R.A.F. It is true that we often have to write letters which do not seem to be of great help, but that is not because careful consideration is not given to these

matters. For example, last year I discovered that there was a problem for airmen and officers where the family had a child of 16 taking his ordinary level examinations. There was a problem of being moved at the wrong time.
It was my view, based on past experience, that it was the last year of the child's life in a secondary school that mattered most. It was not long before a new instruction was issued that an officer or airman who has a child of about 16 years of age taking ordinary level examinations would either be able to stay at his last station for a year or would be moved early to a new station in order to give him a full year there. That is one example of the personnel management which takes place.
Even so, I fully agree that the amount of re-engagement is not enough. The hon. Member said yesterday that in some trades we are not up to strength. This is in the administration trades generally, the List 2 trades, trade assistants general—in my day concerned with equipment—and R.A.F. Regiment men. There are problems in this respect, and that is why it is important, when talking about recruitment, that one should not indulge in recrimination because a decline is taking place. For example, in 1963—I think that was the year—recruitment to the R.A.F. was stopped altogether. This has had an adverse effect on R.A.F. recruiting ever since.
I discovered during the election last year that for the three weeks of the election campaign advertising of this kind had to cease because it was argued that it might reflect on the Government Party and add to their votes in the election. Consequently, I discovered, during the election period no recruitment advertising took place. In the chart which I saw subsequently it was clear that during the election period recruitment had slumped astronomically. It may have been that they were glued to their television sets for one reason or another. It occurs to me that my hon. Friend the Minister of Defence for Administration might think it worth while for both sides of the House to look at this situation. I doubt very much whether there is any kudos to be claimed by the Government party for recruitment advertisements.
A large number of cases about discharge reach the Under-Secretaries in the


Department. A few go to my hon. Friend the Minister for Administration. Perhaps I should explain why they go to different persons. Former Ministers and Privy Councillors and present Ministers—we had to pick a group—go to my right hon. Friend so that he is at the centre and can see a cross-section of discharge problems in three Departments. In the odd case it may be done differently if the case has been previously in the hands of the Under-Secretary.
In the Army there are more cases than those which I received in the R.A.F., but there are a number of ways of obtaining a discharge. One is by purchase. A problem is that if a trade is undermanned it is impossible to do this unless there are compassionate grounds—and what is compassionate is a subject of judgment. But where there are compassionate grounds which are clear and obvious, the R.A.F. will go to the furthest lengths to be helpful. I recall the case of an airman whose wife was suffering from cancer. It was not just a question of discharging him. It was a question of arranging the discharge to meet his needs and when his new home was ready. I find that the R.A.F. is ready to help in this respect. I am looking at the particular case which the hon. Member raised of a statistical clerk.

Mr. Goodhew: What of the position of a person who wishes to purchase his discharge and is then posted, let us say, to Singapore? Perhaps a few months later or a year later he discovers that the manning position is such that he can purchase his discharge. I understand that he is required not only to purchase his discharge but to pay the air fare home. This seems a little hard since it was Purely the exigencies of the Service which took him to Singapore just before he was able to get a discharge.

Mr. Rees: I will look at that point. Normally, if a man puts in for a discharge on career grounds—the needs of the Service come into this—he will not be posted. There may be instances in which it has happened, but I will look into that point.
The hon. Gentleman asked about Malta and the increase of £5,000. At this moment I have not the answer, but I will

write to him if the answer does not appear mysteriously before I finish speaking.
As to receipts in respect to other Governments, there is aid or help to the Ghana Government with their air force. The downward trend is not a reflection of a change in policy.
"Other receipts" represent a variety of matters, including receipts for services to civil authorities, such as hospital services in other countries. Where our strengths are running down, we are able to offer small services so as to maintain these facilities and accordingly the receipts increase. I am not fully aware of why these hospital services in other countries should arise. I will let the hon. Gentleman know when I have had time to look into the matter in greater detail.
The hon. Members for St. Albans and for Merton and Morden (Mr. Humphrey Atkins) raised the question of the Royal Defence College. The underlying philosophy behind the Howard English Report, which has been discussed over a long period, was that young officers of the three Services should spend a period of time together when they are first in the Services rather than later on when they might meet at the I.D.C. or some such institution. In other parts of the word the philosophy has been taken much further and there has been complete integration of the Services.
Not only was there this philosophy behind it. There was also the question of providing greater facilities for higher education in the Services. The great difference between the R.A.F. and the other Services is that our young men at Cranwell have to learn to fly. The question is when they should learn to fly. Would it be good sense to put them into the Royal Defence College when they first come into the R.A.F., after a matter of weeks; to let them do a knife, fork and spoon course at Cranwell and then send them to the R.D.C.? The young men in the R.A.F. would in those circumstances be considerably younger than the Navy and Army cadets. This looms very large in terms of activity in college. Maturity matters a great deal between the ages of 17 and 21, far more than does the difference in maturity at the age of 30, 40 or 43.
In the end it was decided that our young men, certainly the G.D. branch,


would do their basic flying at Cranwell first. As the other cadets will have done a year plus two, our men will still be a year younger. The underlying philosophy and overriding problem is to mix these young men together at an early stage It undoubtedly leads to a problem. The one problem we have to consider most carefully is the split in flying time, the fact that having done their basic training, they would go to the College and might be there for three years. I am not attempting to hide the fact that this is a problem. My argument is that for the two reasons I have given, this was the philosophy which guided us. It was before my time, but I think that probably the Howard English Report was commissioned by the Tory Administration. This idea was not just a political one. It has been played about with for a long time.
The question arises of what happens when a man returns to flying. If he has been absent from flying for a year, there will be a drop in his performance by the time he comes to fly aircraft again. This factor, too, will have to be taken into account. I deliberately said yesterday that it was silly to hide the fact that there are problems. However, they are problems that we are well aware of.

Mr. Humphrey Atkins: The very laudable object of the arrangements which the Under-Secretary is describing is to mix together the young officers of the three Services so that they can help to educate each other by broadening each other's outlook. The defect under the present arrangement is that the young Air Force officer going to the Royal Defence College will go having done very little service. All he will have done is a couple of years at Cranwell. He will be able to contribute nothing to cadets of the other Services. He will not have served in a squadron, group, or whatever. He will be able to contribute very little to greater understanding between the three Services.

Mr. Rees: I accept that this is one of problems. The men from the other Services might even have been in the field, with all the maturing effects this can have. I assure the House that we have considered this aspect carefully. The solution we have arrived at is final in the sense

that, after all the talking, this is what we have decided to do. There is no finality in the sense that alterations cannot be made. I suggested yesteday that if young men can fly, as they do in university air squadrons, this would have an effect.
I assure the House that there is no dogmatic educational philsophy underlying this. It is something we must come to terms with. It is excellent for personnel of the three Services to get together at an earlier time. Perhaps it goes back to the days of the last war, but even in the House when we debate defence matters I sometimes still find the attitude that the R.A.F. is composed of "the Brylcreem boys" who sit in a warm mess all the time and who are rather different from Army personnel. Although this might well be a joke, it can be a barrier which prevents an understanding of the common problems in the Services. It will be an excellent thing if something can be done to overcome this in the early years among young officers.
The hon. Member for Liverpool, Garston (Mr. Fortescue) asked me about figures. I have some figures here. I promise him that if they are not meaningful to him, I will look at them again. I have not had time to turn to the pages in the Defence Estimates. The hon. Gentleman has obviously done his homework. The firm point is that on 1st January, 1967—page 66 of the Defence Statement the figure is 124,300. The only other figure I can give to him is apparently not for 1968 but, from Annex A, that the figure will have dropped to 124,000 by 1st April of this year.
I have a number of other figures here, but I suggest that either we get together on this later in the evening, rather than that I should read the figures meaninglessly now, or that I will put them in black and white.

4.59 p.m.

Mr. J. Enoch Powell: I want to refer to two points arising out of the Under-Secretary's speech. The first concerns the reference of the Grigg Award to the National Board for Prices and Incomes. It is important to re-emphasise the reasons why we on this side think that that reference was inappropriate. The Government cannot themselves determine


what number or quality of recruits or officers they will get at a given price. Therefore, the fixing of the salary and the conditions which are offered is, in effect, a decision about recruitment. It is a decision about the number and quality of the officers and men. Whatever may be said about the functions of the Prices and Incomes Board in other areas of the economy, no one will contend that it is appropriate that that decision should in any way be for the Board.
When they determine Service pay, the Government are simply, clearly and solely taking a decision, which can be only their responsibility, about their recruitment intentions. In our view, it is wholly inappropriate that the directness and clarity of that Government responsibility should in any way be blurred or interrupted. I thought it necessary to re-emphasise that point.
Next, I come to the question of the reorganisation of officer education and the Royal Defence College. As usual, if I may say so, the Under-Secretary of State was helpfully candid in his discussion of the subject, and I was very glad to hear him say that, although the general outlines of the shape of the new educational cursus were a final decision—I think that he called it a final solution—on the part of the Government, their minds are open as to the way in which the reshaping would be organised. There are two or three points which I wish to make about it.
First, I hope that we shall be able to do this initially in a way which makes it possible for account to be taken of experience. The change proposed is a very big one. We ought not to underestimate how fundamental it is and what effect it will have on the ethos of the three Services. We do not know—none of us can know—the effect which the reorganisation will have, and it is all the more important that, without creating avoidable uncertainty, we should not at this stage be dogmatic and we should take into account experience as we go along.
Second, I am not sure that in bringing young officers of the three Services together at the academic stage of their career, and an exclusively academic stage,

we achieve the cohesion which we all want. The hon. Gentleman referred to the deplorable effect which can sometimes result from inter-Service misunderstanding and inter-Service rivalry. Having spent most of my war service in inter-Service organisations of one kind and another, I can personally appreciate the value which arises when members of the different Services work physically together upon the same problems. But—and this I emphasise—that effect is most marked when the problems on which they are working together have a military content, when they are related to the purpose which, after all, has brought men into their respective Services. In my view, this is yet another reason why we should anxiously consider the apparent divorce of the academic section of the new training career from the military or Service aspects.
Finally, the hon. Gentleman referred to the ways in which, during this academic section, it will be possible in the Air Force for the officers to keep in touch with their Service training. Yesterday, in answer to an intervention from my hon. Friend the Member for Macclesfield (Sir A. V. Harvey), he spoke of refresher training perhaps in association with a university air squadron. Before we go any further here, the Government must be much clearer than they have been hitherto about the resources which will be available for this kind of refresher training.
Quite rightly, the hon. Gentleman recognised that for many officers—we hope—this will be a matter not of one year but of three years, and a three-year interruption of the military side of an officer's education is a serious matter indeed. In some of the universities to which they will go, no doubt, there are and will be university air squadrons which can provide a suitable and available framework—

Mr. Merlyn Rees: It may have been a slip of the tongue on my part, and I should make the matter clear. There may be officers who go to university, but the three-year course, the two years after the one, will be at Shrivenham rather than in universities.

Mr. Powell: I should have spoken of the university-style course, the three-year university equivalent course.

Mr. Rees: Yes.

Mr. Powell: In that context, the hon. Gentleman referred to the function of the university air squadrons. Here, we must be better satisfied—not necessarily this afternoon, but before the new scheme is put into effect—that the university air squadrons will be able to provide the framework for that refresher training and continuing military indoctrination, because it will, obviously, be vital to the failure or success of that middle sector of an officer's training.

5.6 p.m.

Mr. Merlyn Rees: First, on the question of what happened last year when the Grigg award went to the National Board for Prices and Incomes, I should make clear that, while there is a wider aspect to it, the question went to the Board for its advice, and in this instance the decision was for the Government, as the original decision had been. Advice on a pay structure from an outside body is, in my view, extremely valuable, and, perhaps, in no field is it more important than where there is an attempt to have a correlation with civilian activities. It is difficult to get the right answer here, and, perhaps, over the years, the wrong answer has been obtained. But in this instance, certainly, the Board was asked for advice.
With regard to Service education, the right hon. Member for Wolverhampton, South-West (Mr. Powell) asks us to take account of experience. I know that he was speaking in a general sense, but one of the difficulties here is that there is no real experience in the practical sense on which one can draw. We are aware of the problem. The quality of experience will be determined by the quality and calibre of the first master whom we appoint. The essence of a university is indefinable. There are times, perhaps, when one would question the freedom which is present in a university, but freedom to think in whatever way one likes, untrammelled by the ideas of the past, perhaps, is a vital part of university life. For this genuinely to be a university will depend on the amount of intellectual freedom available there, which will come from the quality of the staff and the quality of the master in the first instance. I assure the right hon. Gentleman that we are taking these questions very much into account.
As regards the time when young men go up there, what I want to make clear—I shall qualify it in a moment—is that there will be no academic work at Cranwell. At present, at Cranwell and the other colleges a certain amount of academic work is done, though not in the university sense save in so far as it may be related to post-A level. I hope that the right hon. Gentleman will at least go with me when I say that what we are doing is putting young men to do together, at about the same stage in their career, the academic work which has normally been done at the colleges. It is no more than that. It will not take the place of other mixing which may happen at a later time.
The qualification which I make—it is something I feel strongly about—arises from our knowledge that both today and over the last decade or so when we have increased the opportunities for young men and women to have a university education, the failure rate at many universities has been and is alarmingly high. People who have obtained very good A level results do not make the grade when they find themselves studying at university, and the real reason is that they have not a clue how to study. They have been taught, but they have never been taught how to study.
That is certainly something that people on the R.A.F. side are examining and I hope that at Cranwell under the new scheme in the early 1970s some academic work of this type will be done which will help young men when they reach the Royal Defence College. There will be a military slant, although I admit that that is rather different from practical military experience, in the studies that will be carried on at the R.D.C.
I meant it when I said yesterday that a university air squadron may be an appropriate way of young men keeping their flying hand in. Thought is being given to that. There is also a question of civilian flying on the lines of a civilian flying club, and it is extremely important in keeping a young man's hand in for the time when he eventually returns to flying.
We should all bear in mind that often young men who were not very interested in academic studies in their 'teens may well develop late, and the time when some people mature academically is not in


the late 'teens. The scheme has been laid down, but I assure the right hon. Gentleman that there are no closed minds on it. There had to come a time when a decision was made, and I am sure that we were right to follow the Howard English Report and see that future young officers in the Services serve for a time together. The appropriate way was in academic study together instead of in individual colleges.

Question put and agreed to.

Resolved,
That a sum, not exceeding £146,580,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the pay, &amp;c., of the Air Force, which will come in course of payment during the year ending on 31st March. 1968.

Vote 2. Reserve and Auxiliary Services

Motion made, and Question proposed,
That a sum, not exceeding £870,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the Reserve and Auxiliary Services and Cadet Forces (to a number not exceeding 19,620, all ranks, for the Royal Air Force Reserve, and 600, all ranks, for the Royal Auxiliary Air Force), which will come in course of payment during the year ending on 31st March, 1968.

Mr. Deputy Speaker (Mr. Sydney Irving): Mr. Goodhew—

Mr. Goodhew: You have had me taking off from my launching pad at a very rapid rate this afternoon, Mr. Deputy Speaker. If you do it again it will not be very good for my health.
I would first like to ask about a figure under Vote 2 (A) (2),
Pay, &amp;c., of reserve personnel during training, bounties, &amp;c.".
That seems to be reduced from £4,000 to £2,000, a 50 per cent. reduction. Does that mean that there has been less training for reserve personnel during the past year?
Vote 2 (B) (1) deals with pay, allowances, bounties and so on to the Royal Air Force Volunteer Reserve, and again there is a considerable reduction, from £91,000 to £74,000. Is that a result of a direct policy? Are the Government running down the R.A.F. Volunteer Reserve or are they finding insufficient people to join it? What exactly is the cause of that considerable drop?
Vote 2 (C) for the Royal Auxiliary Air Force also shows a considerable reduction. The pay and allowances are down by £5,000, from £38,000 to £33,000. I wonder whether that is a question of the Royal Auxiliary Air Force running down or being undermanned. We understand that it now plays a very limited rô;le and that there are just four maritime headquarters manned by it—a very sad and pale shadow of the former Royal Auxiliary Air Force, which served with such distinction in the last war.
One cannot help wondering whether its contraction into mere headquarter units has not been a very bad thing for the Royal Auxiliary Air Force and those who wish to do part-time service in the R.A.F. There is no doubt that auxiliary squadrons were a great attraction in the past to young men who wished to do part-time service. They produced many of our finest fighter pilots for the early days of the last war, and one is disturbed to see that this very emasculated part of a once great force should apparently be reducing still further, if one is to judge by the pay, allowances and bounties which appear in the Air Estimates.
Vote 2 (D) deals with
Grants, &amp;c., to Territorial and Auxiliary Forces Associations.
Those are up from £300,000 to £350,000, an increase of nearly 17 per cent., which is rather peculiar and surprising as one would have expected that the associations were being run down after the reorganisation of our reserve forces. Does that considerable increase in expenditure include some of the redundancy pay about which there has been so much concern on this side of the House, when we felt that some of the civilian employees of the associations had been given a very raw deal by having their gratuities and redundancy pay amalgamated?
Appendix III mentions the university air squadrons, to which the Under-Secretary of State referred yesterday in dealing with the question of flying training of those at the Royal Defence College. This purely factual appendix tells us that:
University air squadrons form part of the Royal Air Force Volunteer Reserve. There are 18 squadrons which serve 24 universities providing pilot training and also, in certain squadrons, training for technical duties. Estimated average numbers of staffs at university


centres in 1967–68 are 97 officers, 108 airmen and 78 civilians. Provision for these staffs and other supplies and services is included under the appropriate Votes.
What exactly is the future of the squadrons? The appendix does not indicate whether it is proposed that they should continue, whether they are flourishing, failing, or what is happening to them. That is an important aspect of the Royal Air Force, because there has been considerable recruitment for regular service from the university air squadrons in the past. I very much hope that the Minister can tell us his plans For them in the future.

5.18 p.m.

Mr. Anthony Kershaw: My hon. Friend the Member for St. Albans (Mr. Goodhew) has said how unfortunate it is that while payments to the T. & A.F. Associations appear to have risen in the Vote compared with last year, they must be limited by the most unfortunate decision to amalgamate the redundancy pay under the Redundancy Payments Act and the gratuities which the civilian employees of the associations imagined they were earning in addition to their pay.
We have been into that matter, and it would be inappropriate to dun the Minister again with the same argument. Nevertheless, I wish once again to register my regret that the Treasury should compel the Ministry to act as a less good employer. I feel sure that it is as embarrassing to the Minister as it is to anybody that he should do this, but one regrets that it is happening.
It has had a further unfortunate effect which I did not appreciate when we had our previous debate on the subject about three weeks ago. That is that it is widely regarded as a "dry run" for the Treasury, so that it does not get caught again with what it considers to be overlarge payments of the "golden bowler" type to officers who, because of the rundown of the Forces, have been told that they must shortly retire, before they reach the age of 55, which was the previous arrangement.
It is widely felt that the Treasury considered that it had rather bad treatment on that last occasion. Now it is determined to hold up these arrangements until there is better treatment for the

Treasury than before. Therefore, this delay in allowing officers to put forward their resignations, after for a long time having been encouraged to do so, has caused dismay, and to some extent hardship.
These officers and other ranks are approaching an age at which it will be difficult for them to get a job in civil life. The arrangements they have made have not been easy to make. This may be their last chance and they may find their opportunities are frozen. I hope that the Minister will convey to those concerned our sense that these matters are urgent so that these people may know where they stand. Quite apart from the money they receive, this is a matter of real importance to those concerned.
The Under-Secretary did not have time when answering questions last night at the end of the debate to tell me about my "bird", the one girl in the R.A.F. Volunteer Reserve. I should like to know who she is and where she lives.

5.22 p.m.

Mr. Merlyn Rees: If I knew that I would not tell the hon. Member, but I will find out what I can about that matter. In view of what he said about the R.A.F. yesterday, it may be that my remark is tit-for-tat.
A number of questions have been asked. The first was about the reserves at the beginning, the R.A.F.V.R., the Royal Auxiliary Air Force and so on. The policy in regard to R.A.F. reserves was taken—I am not making a big political point about this—in the mid-1950s. This arose, I think, because the different philosophy about the reserve question of the R.A.F. is based on the fact that on the whole they will fly very expensive aircraft and a reservist is not in a position to do this. I make no reflection on the other Services, but this is a different function. So far as concerns the R.A.F., there is this difference in attitude, which is now of some years standing. General R.A.F. policy is that trained reinforcements overseas in the event of an emergency would come from Regular personnel and because of this fewer reservists would be required to be trained next year. This is the simple answer to the question, why have pay and bounties gone down?
There are two things to say about Territorials. Vote II(D) does not contain anything concerning the R.A.F. in respect of redundancy, which primarily is an Army problem. The reason why the Vote has gone up is that the Air Training Corps is an R.A.F. responsibility. Often the young men use huts on premises of the Territorial Army and they come under the Territorial Army Association in that sense. In my constituency the R.A.F. and the A.T.C. have a very fine pair of huts on a former T.A. site. I believe that when that site is sold a small portion will be kept going. Where such a procedure is impossible, we have to provide huts for the Air Training Corps. That is the reason for the increase in that Vote.
I think I have answered the hon. Member for Stroud (Mr. Kershaw). He made his point and I have no responsibility in that respect. It is one for the Army and I think he and his hon. Friends can make their point at some other time.

Question put and agreed to.

Resolved,
That a sum, not exceeding £870,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the Reserve and Auxiliary Services and Cadet Forces (to a number not exceeding 19,620, all ranks, for the Royal Air Force Reserve, and 600, all ranks, for the Royal Auxiliary Air Force), which will come in course of payment during the year ending on the 31st day of March, 1968.

Vote 7. Aircraft and Stores

Motion made, and Question proposed,
That a sum, not exceeding £268,000,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expence of aircraft and stores, which will come in course of payment during the year ending on the 31st day of March, 1968.

Sir Geoffrey de Freitas: Sir Geoffrey de Freitas (Kettering) rose—

Mr. Emrys Hughes: Mr. Emrys Hughes (South Ayrshire) rose—

Mr. Deputy Speaker: Mr. Goodhew.

5.25 p.m.

Mr. Goodhew: Mr. Deputy Speaker, you are giving us all heart attacks, not only hon. Members on this side of the House.
I cannot allow this Vote to go by without referring to the form of wording

under A and B and the rest of Vote 7. It is fascinating to read what was said by the present Paymaster-General on 9th March, 1964. I have told him that I would be quoting what he said on that occasion. He said:
I have been trying to expose—and I am using this opportunity to do it again—the vacillation and the cowardice of right hon. Gentlemen opposite who dare not tell their back benchers and the country the truth about the expenditure of £2,000 million. Because they dare not, they treat not only this assembly but the country as if they were children. The Government have produced the Estimates in this form, and I protest about it. I have been protesting for the last ten days."—[OFFICIAL REPORT, 9th March, 1964; Vol. 691, c. 140.]
It is quite remarkable that such a thing should have been said by the Paymaster-General in 1964 and that the Government of which he is a member should have been in office for two-and-a-half years, but we now find these Estimates presented in precisely the same form as that about which the right hon. Gentleman protested. I have a copy of the 1964–65 Estimates about which he was complaining. If any hon. or right hon. Member cares to look at them, he will find that it does not matter whether he looks at the 1967–68 or the 1964–65 Estimates, the wording is precisely the same and only the figures have changed. For someone who was accusing the Conservative Government of that time of cowardice and saying that they dare not give the House the truth and dare not tell their back benchers or the country the truth about what they were spending on aircraft, to be now a member of the Government and to do nothing about it is extraordinary.
It is the more extraordinary because the right hon. Gentleman does not have a Department to worry about. He lives in No. 10 Downing Street during his working hours, where one would expect him to use his influence to put the matter right. I find that the right hon. Member for Sheffield. Park (Mr. Mulley) said:
I defy anyone to read Vote 7 and obtain from it any idea of the amount of money for particular projects or how the figures are worked out."—[OFFICIAL REPORT, 9th March, 1964, Vol. 691, c. 144.]
This right hon. Gentleman is a member of the Government and he has been in the Government for two-and-a-half years. He has even been a Minister in the Ministry of Defence. What has he done


about it? We have exactly the same form of words. I hope that we shall have an explanation this afternoon of how it is that hon. and right hon. Gentlemen who in opposition made such a fuss and accused us of cowardice and talked so much about government with guts, a gritty Government, and so forth, have not done something about putting right what they thought extremely wrong. It seems extraordinary that they should continue this form of words.
The figures for Vote 7A and Vote 7B, which are for airframes and aero-engines, would have been much higher were it not that we are buying American aircraft "on tick". There are many aircraft on the way for which payment would fall due in this Vote were it not that payment is being deferred. The reduction in the amount being spent on airframes is misleading. As I said yesterday, it is in the 1970s that we shall be suddenly seeing a large increase in this Vote, and no doubt hon. Members opposite, who will then be in opposition, will complain bitterly about it. We shall then have the deferred costs of the F111K coming in; deliveries of the Anglo-French variable geometry aircraft; we shall be receiving Phantom aircraft from America; we shall be buying the Anglo-French Jaguar aircraft and, presumably, we shall be having deliveries of the P1127.
It is always interesting to read previous debates on these matters. The right hon. Gentleman the Paymaster-General slammed us nearly a year ago. On 18th March he was asking how many Lightnings had been sold and saying that the answer was none. In fact, how many Lightnings have now been sold? This is the aircraft produced by a Tory Government, and many have now been sold to Saudi-Arabia and we are selling them to Kuwait. [HON. MEMBERS: "Does the hon. Gentleman applaud that?"] I applaud it, indeed. I am explaining that this is an aircraft which the previous Government ordered and that it is an excellent aircraft, worthy of consideration by other countries. The Paymaster-General sneered at us for selling only three Buccaneers to South Africa, but we could have sold many more but for the Government's policy towards South Africa.
We are told that the Phantom is a very fine aircraft. I understand—and here

again I must say that I have been doing my reading in Janes "All the World's Aircraft" since I still insist that one gets more information from that than one does on the Floor of the House—that the version which we are getting is the F4N which is a development of the F4K which is being built for the Royal Navy. What is so strange is that the version being developed for the Royal Air Force is to retain the folding wings and arrester gear of the Naval version. I should be interested to hear whether that information is wrong, although I cannot believe it is when everything else I have quoted from this source has been confirmed by the Minister.
It seems extraordinary that the R.A.F. should be having an aircraft retaining the folding wings and arrester gear of the Navy version for aircraft carrier landings. In spite of what I said yesterday about the disappearance of the island-base concept which was to have replaced the carriers, I cannot believe that the Secretary of State for Defence has suddenly decided to have carriers for R.A.F. aircraft to land on as well.
There may be some other reason, and perhaps it is cheaper to have a continuing production line of aircraft all on a similar basis. I imagine that the fuselage of the British version, which contains Spey engines, probably has a different make-up from the American version and it is possible that to save adapting a special fuselage to R.A.F. purposes we are having some with built-in arrester gear and with folding wings, but it seems an odd thing to do. One would have thought that it would add unnecessary weight to the aircraft, which is something which one always tries to avoid.
It was encouraging to learn yesterday that these aircraft are to be half British. There is no doubt that the Rolls-Royce Spey engine has been much applauded in America, so much that the Americans are to install the Spey engine in their A7 Corsair. The Estimates contain an amount of £100 million for the sale of Spey engines for the A7 Corsair. The amount is included as part of the offset sales against the F111K, but I suspect that the Spey engine sold on its own merits, because it enables the Corsair to take off with a much shorter run than was possible with the American engine.
I come now to the P1127, now named the Harrier. I had the good fortune to go to West Rainham when the Kestrel Evaluation Squadron was working there, and I met the pilots from the United States, Germany and the R.A.F. who were using these machines and evaluating them and who were undoubtedly greatly impressed by this form of aircraft. I was, therefore, not surprised to find that we were to have some form of vertical take off aircraft.
What is surprising is that at this stage we should still not have a fixed price contract for the initial order, and one is always disturbed when one finds that items of this sort are outstanding at such a late stage when it has been understood that these aircraft were well on the way—like so many other aircraft which the R.A.F. is to have.
I also have grave fears about the Americans having had experience in the Kestrel Evaluation Squadron, being allowed to keep several of these aircraft. I am anxious that they may be busy trying to produce something equivalent, or even slightly better, to try to beat us in the export markets. I would have hoped that when we did this deal of letting them have the P1127s from the Kestrel Evaluation Squadron we would have tried to do something about ensuring that we were able to sell the Americans some aircraft, or perhaps allow them to make some under licence, rather than that the techniques which have been developed here should be applied over there and the aircraft sold more cheaply in markets in which we would otherwise be selling ourselves. I shall be interested to hear whether the Government have done anything to arrange for the sale of some of these Harriers to the United States as part of the offset agreement.
We cannot let this Vote go by without saying how concerned we are that no final price has yet been fixed for the F111K. It is extraordinary that it is still outstanding at the moment when we are debating these matters and may be fixed just afterwards. After a few years in the House, one is always anxious, or perhaps even suspicious, when this type of thing happens. I am most anxious that we should not find ourselves paying a much higher price than was

originally intended. I spoke about the Anglo-French variable geometry aircraft at some length yesterday, and I would only like to emphasise once more that it is most unfortunate that we should be talking about this aircraft—

The Under-Secretary of State for Defence for the Royal Navy (Mr. Maurice Foley): I want to point out that the AFVG is not included in this Estimate, and is not in the 1967–68 Estimates.

Mr. Goodhew: I imagine that we are entitled to talk about the aircraft which are being purchased by the Royal Air Force.

Mr. Deputy Speaker (Sir Eric Fletcher): Order. The hon. Gentleman is only entitled to talk about any purchase covered by this Estimate.

Mr. Powell: Can the Under-Secretary help the House by telling us where in the Estimates the expenditure which will be incurred on the AFVG during the next financial year will be shown?

Mr. Merlyn Rees: All that I know is that they are not on this Estimate, by the very nature of it, because it is the R.A.F. Estimate. I think that I am right in saying that when they appear they will form part of the Ministry of Technology Vote. What happens is that the payment for the aircraft, and other R.A.F. equipment, is made from the Purchasing Repayments Services Vote of the Ministry of Technology. These payments are made during the currency of contracts, and it is only when the aircraft are actually delivered to the R.A.F. that the charges are transferred to the Air Vote
I am certainly not responsible for any expenditure on the AFVG. Last night I attempted to join in the argument about the rôle of the AFVG, and that was quite properly a question which arose on the Estimates yesterday. I do not know if it would be relevant today.

Mr. Goodhew: This makes it absolutely clear how right the right hon. Gentleman the Paymaster-General was 2½ years ago when he complained about these matters, saying that one merely had a word like "airframe" but did not know to which aircraft it referred. I am glad to see him here, and I would be interested to know what he has done about


this. He made a great deal of fuss about this previously.

Mr. Emrys Hughes: On a point of order. Is the salary of the Paymaster-General included in these Estimates?

Mr. Deputy Speaker: I doubt whether the Minister could help us on that.

Mr. Goodhew: I find myself in the same difficulty as did the right hon. Gentleman. The only difference is that I am in opposition. He has been in government for 2½ years, yet we find ourselves in exactly the same position today. I should be interested to know whether the right hon. Gentleman has done anything to change the situation, so that in future debates we will have a new form of Vote, so that we may understand what this is all about.

The Paymaster-General (Mr. George Wigg): I am always anxious to help hon. Gentlemen, even if it includes a lesson in procedure. There was a Select Committee on Procedure set up by the last Administration, rather belatedly. I was a member of it, as was the then Leader of the House. One of the matters discussed was the form of the Service Estimates. I would suggest that the hon. Gentleman, with his well-known Parliamentary skill, should read the Committee's Report, which he obviously has not done and then raise the matter on an appropriate occasion, which is not today.

Mr. Goodhew: That is just the sort of answer that I would have expected from the right hon. Gentleman, having seen him come here day after day, giving stupid and thoroughly uninformed Answers to Questions when he was at the top of the list. If he thought in 1964 that something should be done about this, I am surprised that he cannot tell me that he has done something about it.

Mr. Wigg: The hon. Gentleman does not seem to realise that this is not a matter for the Executive; it is a matter for the House of Commons. There was a Select Committee on Procedure which discussed this, and I would have thought that the hon. Gentleman and his colleagues would be among the first to realise that if one is to alter the form of the Estimates, it has to be on an agreed

basis. I earnestly suggest that the hon. Gentleman should read the Select Committee Report, and then he will not talk the nonsense that he has already talked.

Mr. Goodhew: The right hon. Gentleman enjoys being offensive. He has told us before that he loathes our guts, and I suppose that that is why. It would be interesting to know whether the Select Committee has made any proposals. Perhaps the right hon. Gentleman could tell us.

Mr. Wigg: The hon. Gentleman has free access to the Library. The Select Committee, of which hon. Gentlemen opposite were members, made its recommendations to the House. I am as keen as the hon. Gentleman, and as any other hon. Member in any part of the House, to revise the form of the Estimates. I think that more information ought to be given, but it is a matter for the House. The House of Commons governs its own legislation by Resolution. The hon. Gentleman is pushing at an open door over the administration.

Mr. Goodhew: It is a great pity that the right hon. Gentleman did not show a little sympathy for my view instead of being so offensive. We will leave it at that. As it seems that we are unable to discuss the aircraft, which for all we know may appear in here, I hope that the Under-Secretary will tell us what aircraft are contained in this Vote, so that my hon. Friends when they speak will know that they are not going beyond the rules of order.

5.46 p.m.

Mr. Emrys Hughes: I welcome the appearance of the Paymaster-General in this debate, because during the days when we were in opposition, he used to direct some very searching questions at the then Government, a great many of which were not answered. What I am sorry about is that the right hon. Gentleman, who used to render me such excellent service in these debates, has left the back benches, and has become a political or military adviser at Crufts I regret the absence of the right hon. Member from the back benches, and I want to do my best to substitute for him. I was a most assiduous attender of the debates in which he used to take part, and I used to regard myself in some way as his Parliamentary Private Secretary.

Sir Harmar Nicholls: I did not hear the hon. Gentleman clearly. Did he say that his right hon. Friend was adviser to Krupps or to Crufts.

Mr. Emrys Hughes: The hon. Gentleman can take his own version. I want to continue the process begun by my right hon. Friend. I am not a member of the Government. I am only a humble back bencher seeking information. I cannot understand the point of view of the hon. Member for St. Albans (Mr. Goodhew). If he comes to this side of the House, he has one view and if he goes to the other he has another view.
It is just a question of the pot calling the kettle black. I want further information about these Estimates. For example, I want to know about the armaments, ammunition and the explosives which are itemised in Vote 7 under Stores and Equipment. It seems that this is an amazing sum to be granted by the House with such little information. This was the same when the hon. Gentlemen opposite were in power. If by some chance they shifted over here again, there would be the same formula, and I do not want to see that happen. I should like to know why such very large sums of money are dismissed in such few words.
The R.A.F. is not engaged in a major war. I should have thought that the sum of £26,800,000 for armaments, ammunition and explosives was very considerable when there is no war on. How is it made up? Is the R.A.F. stockpiling and, if so, what is it stockpiling?
A front page article in The Times on 8th March said:
The Cabinet have been considering for six months the question whether to stop making hydrogen bombs".
I am entitled to know, I think, whether any atomic bombs are included in this large sum of £26 million. Of course, I will not be told; I do not know why. When Mr. Attlee was Prime Minister I remember Sir Winston Churchill coming to the House and attacking the Labour Government because they had hidden the large sum of £100 million in manufacturing the atom bomb. I should like to know whether this £26 million comprises an item for atomic weapons. Surely that is a relevant question.
I can hardly believe that The Times would display on the front page an article

on "a new generation of nuclear weapons" and underground tests if there were nothing in it. Surely the defence correspondent of The Times does not produce this sort of thing from his imagination. He said:
Last week in the Commons, Mr. Healey, Defence Minister, hinted for the first time at the likely direction of policy when he confirmed that he had not closed his mind to the further development of the Polaris warhead".
I understand that the Polaris warhead is not included in this Vote. We shall come to that later when we have the opportunity of discussing Polaris on the Navy Estimates. We are entitled to know why so much ammunition and so many rockets, bombs, guided missiles and torpedoes costing this very substantial sum are included in this Vote.
Last year the sum was approximately the same. Are we to spend £26 million every year? If so, for what purpose? Hon. Members, when they are asked to pass these very large sums of money, should have greater detail. May we be told how much of this sum is for ammunition, how much for rockets, how much for bombs, how much for guided missiles and how much for torpedoes?
I ask these questions knowing that I shall be told that they cannot be answered for security reasons. But before I came to the House and when I was a member of a local authority if I were presented with a sum of money I wanted to know how it was made up. Therefore, I wish to know how much is included in this Vote for hydrogen bombs. Perhaps we can be told something about the question which the Cabinet has been considering for six months—whether to stop making hydrogen bombs. Has it come to the conclusion that hydrogen bombs are too expensive, or that they are ineffective, or that they are likely to be suicidal weapons?

5.56 p.m.

Mr. Tam Dalyell: This is the sixth day on which I have sat through the defence debates. This is my fourth speech, and it will be easily the briefest.
I passionately agree with the Paymaster-General on one point, namely, that if one has learnt anything over the last six days it is the need for a Select Committee on defence. On previous occasions I have wondered whether there


were not great disadvantages in giving authority on defence matters to just a few élite Members on both sides of the House and whether this would be a good idea. That is how I used to think. Now I am clear in my mind that when debates are so sparsely attended and the issues are so huge and often so complex a Select Committee on the Armed Forces or defence—call it what we will—is an urgent necessity. Those of us who have had some experience, albeit small, of the Select Committee on Science and Technology—the hon. Members for Mid-Bedfordshire (Mr. Hastings) and Orpington (Mr. Lubbock) and my hon. Friends—agree, I think, that this kind of Select Committee will work in practice and will he to the benefit of democracy and of the Services.
I have a few specific questions to put. I should like to ask my hon. Friend what is the unit cost of the Phantom. I think that he said yesterday that he was prepared to give it. What value in the Phantom aircraft is represented by British equipment such as the Rolls Royce Spey engine, the Ferranti navigational attack system and the various components in the airframe? I do not see that there is any security involved in this issue. When does my hon. Friend expect to announce his decision on a further final order for the Phantom? Will he estimate how many Phantoms he expects to order in this further final order? How many Phantoms does he expect to deploy in the Middle East and the Far East?
What is the radius of action of the British version of the F111? We are told that it is vast. The reason that I ask this question is obvious. It concerns the complex and important matter of drag, which we are told is up to 35 per cent. When does my hon. Friend expect to complete negotiations on the ceiling price of additions made for the R.A.F. version of the F111? He said something about this yesterday which did not understand; the fault may well be mine.
How many officers and civilians accompanied my hon. Friend on his visit to Texas and St. Louis? What was their rank and what technical qualifications did they have? I think that a number of us on the Public Accounts Committee

became extremely worried about the shortage of technical cost officers in the Service. I realise that it is difficult to recruit such men and that they may be precisely the sort of men wanted in industry. Nevertheless, there is a problem here.
I return to the question of drag on the F111. By what percentage does the present figure of drag exceed the estimate given for some convenient date at the beginning of 1966? It seems that the drag estimate has increased considerably since the representatives of General Dynamics were with us.
Finally, what are the estimated annual running costs of the C130 Hercules, and when does my hon. Friend expect to accept delivery of the last of the 66 aircraft which have been ordered from the United States?
All these questions are meaningful and relevant. I should be grateful for answers to them.

6.0 p.m.

Mr. Kershaw: It is astonishing that this Vote about aircraft and stores should not include anything about the AFVG. The Government are buying aircraft and engaging in the development of aircraft abroad, but with the setting up of the Ministry of Technology, apparently the House is deprived of the opportunity of discussing these matters in these debates. As I understood the hon. Gentleman, he said that it is nothing to do with him and that, as far as he knew, it was something to do with the Ministry of Technology. If that is so, it is a new factor which I did not anticipate when I heard about the setting up of that Ministry. It is strange that in this debate, where quite obviously we have come here to talk about military aircraft, we should find that there is no way in which we can talk about all aircraft, but merely those which the Minister says are included in this Vote.
Looking through Vote 7 in is full version, it is hard to imagine that at least some of the expenditure does not include expenditure by the Government overseas on the AFVG project and others. I notice one or two sharp increases For instance, on page 155 of the Defence Estimates, under Subhead H of Vote 7, one sees that repayments of principal and


interest on loans for aircraft, etc., purchased overseas have risen from £1·9 million to £9·4 million over last year. It would seem that, concealed in that figure is part of the expense of buying aircraft from abroad and setting up the manufacture of the AFVG.
I know that the House as a whole shares a certain amount of the responsibility for the form of the Estimates. It was Professor Parkinson who explained their form by saying that, originally, it had been devised in the time of Charles II to conceal the fact that money voted for the Navy was devoted by Charles II to his mistresses, and that even in that it was not particularly successful. Now we find that money voted by Parliament is being spent in ways entirely different from what we think we are discussing, and we discover that there is an individual Ministry standing between us and our debate. I suggest that the Government should take the initiative and look at the matter to see if they can devise something else for us before next year.

6.5 p.m.

Mr. Humphrey Atkins: I wish to inquire from the hon. Gentleman about Subheads A and B, dealing with air frames and engines, with particular reference to the number of aircraft that he is buying for Transport Command included in these large sums which we are being asked to vote.
Paragraph 49 of the Statement on Defence refers to the build-up of Transport Command, particularly that of the VC10 and Belfast forces. During yesterday's debate, there was a good deal of reference made to the Seventh Report of the Estimates Committee, which clearly indicates that the increases in Transport Command were a mistake. The hon. Gentleman said that his Department did not agree with the Committee's finding, and what I wish to know is whether he is proposing to take any notice of it.
I appreciate that, if he has ordered certain aeroplanes to build up Transport Command, and they are due for delivery shortly with payment due in the next few months, probably he will not be able to cancel them. We understand and accept that. But I should like him to take the opportunity of telling the House how much of the £91 million and £57¾ million

respectively is for Transport Command aircraft and, in view of the Estimates Committee's Report, whether he proposes to re-examine the plans for purchasing transport aircraft, which the Estimates Committee feels should be looked at and probably reconsidered.

6.6 p.m.

Captain Walter Elliot: I want to ask the Minister one short point which relates to Subhead E, dealing with vehicles and marine craft, against which the figure of £6 million appears. Could the Minister say what proportion of that is for marine craft? I do not want to get out of order, but, if one glances briefly at the Army Estimates, one sees a subhead dealing with aircraft and ships, and I notice that the ships are to cost something over £1 million. It is useful to know that, and I should like to know what marine craft are proposed for the Royal Air Force.
In the rationalisation which is being undertaken by the Ministry of Defence, certain services which previously were provided separately by the individual Services are being co-ordinated into one Service. In the case of marine aircraft, instead of each of the Services having its own expensive maintenance depots as well as its own craft, savings might be made if they all came under one Service, and that would seem to fall naturally within the sphere of the Royal Navy. Can the Minister say if anything is being done along these lines in this case?

6.7 p.m.

Mr. Powell: You will recall, Mr. Deputy Speaker, that because, exceptionally, a Vote on Account for Defence was taken last year due to the dissolution of Parliament, this Estimate was not before the House and a debate such as we are having today did not take place. In fact, it is two years since we last had a debate in this form and, during that time, there have been substantial changes not only in the content, but, to some extent, in the nature of our expenditure upon aircraft and stores.
As the House was rightly reminded by the right hon. Gentleman the Paymaster-General, the Estimates Committee has always exercised a special function in tendering advice on the form in which the Estimates would be acceptable to the House. Nevertheless, I am sure that


it is right for the House to be able, when Estimates come before it, to comment upon the convenience or otherwise of the form in which they are presented. To do so implies no derogation of the functions or the importance of the Estimates Committee.
As my right hon. Friend the Member for St. Albans (Mr. Goodhew) reminded us, in years gone by the right hon. Gentleman was critical of the uninformative nature of these Estimates. From the form of Estimate, it is impossible to get any idea of the way in which the movement of expenditure is distributed, for example, over the main types of aircraft which are at present being supplied for the use of the Royal Air Force.
One realises that there are important security and, I imagine, commercial considerations which have to be borne in mind, but it is difficult to suppose that it is impossible for a form of Estimates to be devised which would give the House some indication, at any rate, of which aircraft were covered by the respective sub-heads, even if we cannot, for reasons which might be quite intelligible, have knowledge of the specific and precise sums which are relevant to each aircraft.
I feel that the old objections which were made in the past by the right hon. Gentleman who is now Paymaster-General are still effective, and that they are more effective today in that, as my hon. Friend the Member for St. Albans pointed out yesterday, we have a much greater variety of different combat aircraft in service than was envisaged under the previous Administration. But there is now an entirely new feature, new certainly since the Parliament before last, which makes the problem of the form of these Estimates much more far-reaching and urgent. You will find, Mr. Deputy-Speaker, a trace of this new development in subhead H of the present Vote, concerned with repayments of principal and interest on loans for aircraft purchased overseas ".
It is a notorious fact that during the last two years one of the big developments in the financing of our defence effort has been that a great block of expenditure to be incurred, and which is literally being incurred, in these years upon aircraft is being shifted bodily forward almost entirely into the 1970s. So that while, in these years, we are incurring indefeas-

ible liabilities for the future, which will appear in Votes which will be presented to the House, which will be put to the House by yourself, Mr. Deputy Speaker, and by your successors in the Chair in later years, while we are taking the decisions now, little or no trace of those decisions appear when the House comes, as it will be doing presently, to vote the money.
It is true that certain payments are currently made. Those are the payments which we see under Subhead H, and some trace, some cloud no bigger than a man's hand, of the enormous liabilities in future years, is to be seen in the increase under that subhead from £1,900,000 last year to £9,400,000 already. But, as you will appreciate, Mr. Deputy Speaker, this is a tiny fraction even of the cost of the aircraft which have effectively been ordered, and which, I presume, in some sense are ours already under these arrangements.
It seems to me that with this new form of financing, which, whether we like it or not, will be with us for many years to come, it is more urgent than ever for the House to take a look at the form of these Estimates and to consider whether they ought not to be supported by what I might call a kind of commercial statement. Of course, in the case of the Post Office, we have, for some years now, been accustomed to a double presentation of the Estimates in the Parliamentary, strictly annual, strictly cash form, to which this House rightly adheres, and also in a commercial form which shows the way in which liabilities are accruing.
It seems to me that it is now urgent that we should be able to see, year by year, the liabilities which in that year it is proposed to incur. There has been reference—and hon. Members, because of the form of the Estimates, have had great difficulty in knowing how far they were in order in making reference—to the purchase of the F111A or the FMK, as the case may be. We know that last year 10 of these aircraft were ordered, and we know that the option to order another 40 will expire at the end of this month. It is ironical that with the Estimates for the coming financial year before us, we cannot tell—it may be that we cannot even ask—whether those aircraft are to be ordered.
There is a real absurdity here. Here is a Government intention to incur expediture or not in the coming financial year, and yet it is possible that no trace of that intended expenditure appears at all in these Estimates. It may not, so far as I know, even occur under Subhead H. I imagine that the next 40, if there will be a next 40, does not occur under Subhead H. Possibly, the hon. Gentleman will tell us that some trace of the original 10 may be found somewhere in Subhead H.
It cannot in the long run he tolerable for the House to be satisfied with Estimates in this form, given that we are now financing the purchase of our major aircraft in a form so different from that which was customary in former years, and, indeed, from that which to some extent still applies in the other services. We shall find that we shall have a much more rational debate on the corresponding Navy Estimates than we are able to have under these Estimates.
What we shall be looking for is, first, some way in which we can be clear about the classes of equipment, the nature of the equipment, which is comprised in the cash estimate before the House, in the cash Vote which is being made. Secondly, that we shall be able to judge the manner in which it is proposed that the liabilities of this country and those of the taxpayer will be increased during the ensuing 12 months.

Mr. Dalyell: I find the right hon. Gentleman's idea of a prognosis into the 1970s year by year of liabilities very attractive. But would not the right hon. Gentleman agree that it has been the experience of all administrations that these kind of commitments tend to be open-ended? It might be very difficult to give a realistic estimate about this.

Mr. Powell: I think that the hon. Gentleman has mistaken my intention. I gather that from his use of the word "prognosis". I am not asking—that would be a separate matter—for an estimate of the total liability which is incurred by a decision, for example, to go for a new class of aircraft, but I am concerned with, as I call it, the indefeasible liability which is incurred by the orders which the Government will actually place in that year. I can hardly believe that the liabilities involved in those orders in that 12 months cannot

be quantified. They ought to be quantified. They ought to be quantified, and if they cannot be quantified the House should know why they cannot be quantified.
It would be a separate matter, and a matter more appropriately debated in our more general defence debates, to see where we are going in total in the 1970s. My reference to the 1970s was in a different context, namely, that if this American loan, if the purchase of aircraft "on tick" were to be a very brief phenomenon, one with which we have to cope for only a year or two, there would not be much point in arguing for a different presentation from the one on which I am speaking.
But we shall have to live with this system for more than a decade, and it is right that here, at the outset of the process, we should make it clear why this type of Estimate does not make it possible for the House to have an intelligent debate.
Seeking to relate my remarks to the detailed questions which have been put to the Parliamentary Under-Secretary during the course of the debate, I would ask him—I am sure that, as usual, he will be as candid as he possibly can—that if the payments, either under Subhead A or under Subhead H, relate either to the F111A or the F111K, or any other aircraft which has been mentioned by hon. Members, he will do his best to satisfy hon. Members.

6.20 p.m.

Mr. Merlyn Rees: We have, quite rightly, been discussing the possibility of changing the form of the Estimates. Yesterday I suggested, albeit briefly, that this matter was being considered by my right hon. Friend the Secretary of State. As I stand here, prepared to reply with a mass of information which I have hastily been collecting and writing, I must say that one great improvement which could be made, whatever the form, is that hon. Members might inform mere Under-Secretaries of the detailed information they require. That would make matters easier.
I do not say this unkindly, because this practice has gone on for a long time. I accept that at the very beginning the right hon. Member for Wolverhampton, South-West (Mr. Powell) said that he


would be prepared to receive this information later. From an efficiency point of view I have gathered a great deal of information. It is to some degree in the lap of the gods whether in the course of the next 10 minutes I shall get the right piece of paper at the right time.

Mr. Powell: The Under-Secretary has drawn attention to another embarrassment in our procedure. This year, not for the first time, this debate has been held on the day succeeding a debate on the Air Estimates. It is the general feeling that it is unsatisfactory, before even the whole of HANSARD for yesterday's proceedings has been published, for us to be having this debate. I know that my hon. Friends who had hoped to raise points in yesterday's debate, and who in many cases did raise points, and who again in many cases received answers which they might have wished to carry further, are unable to let the Government know what those points are, because of the time factor.

Mr. Rees: I agree with the right hon. Gentleman. That is a valid criticism. At the end of last night's debate I collected together lots of pieces of paper and put them in my pocket. It was my good fortune to find that my private secretary is a student of calligraphy and he managed to decipher what I said last night, because I could not get it out of HANSARD either.
I will deal straight away with two points that do not fit into the pattern of what I shall say. If I deal with them now there is no chance of my forgetting them later. We shall be studying further the Report of the Select Committee, as I said last night. This year the great change for Transport Command is that the Belfasts and VC1Os will be coming into service. The House will be interested to know in relation to subhead A(1) that the amount of money spent on Transport Command in these Estimates is £30 million, as compared with £33 million in the previous year. This is because of the VC1Os and the Belfasts already coming into service.
The hon. and gallant Member for Carshalton (Captain W. Elliot) asked about vehicles and marine craft under Subhead C. Four hundred thousand pounds of this is on long-range marine craft. The hon. and gallant Gentleman

will know the nature of the R.A.F. marine craft which we keep down at Plymouth and which play a part in exercises with Coastal Command.
The question of co-ordination—or, as the "in" word at the Ministry has it, rationalisation—is being actively considered at the moment, because this is an obvious field where rationalisation studies could take place.
I said last night that the form of the Estimates might follow the pattern of the new Ministerial responsibilities in the Ministry of Defence. On the question of timing, it would have been difficult for the form of the Estimates to have been altered in 1964 under a new Government with a majority of three. In 1965 the Estimates did not appear. Therefore, the delay is not nearly as bad as might otherwise have been thought.
I have been asked about the sales of aircraft and also about the A7 Spey. It is most improbable that the Spey would have gone into the A7 if the United States Government had not agreed to modify the import duties, as they did in a significant way as part of the offset arrangements. The restrictions concerned are considerable, both in legislation passed by the American Government in recent years and in other legislation going back to the Roosevelt era. Another improvement has been the close cooperation on sales whereby identification of possible sales is made in the American Department of Defence.
I am not able to give full details of Lightning sales. A small piece of information that I have is that the increase of about £2½ million in this year's Estimates is due mainly to the sales of aircraft and equipment—for example, surplus Hunters—through contractors. This is done rather on a Government to Government basis, the surplus Hunters being sold through Hawker-Siddeleys to the Government of the Saudi Arabian Federation and other overseas Government. I regret that I am not able to give more information on this point at this stage.
I collected together a fair amount of information which I intended to give to my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) last night. However, time was pressing and I did not do so. I have the information, but I do not think that it is appropriate to go through it all now. I will merely relate it to the Phantom. It is right that ours


is the "M". We keep the folding wings because it is part of the basic design and to have altered the basic design would have added greatly to the cost. The arresting gear has also been left, but this is not as silly as it might sound. Again, a cost factor was involved in moving this, because obviously from the start of the line at St. Louis a change would have had to have been made and this would have been yet another expense. I do not offer this as the major reason, but I am advised that to have this on certain airfields a wire can be put across and overshoot can be prevented just as on a carrier.
My hon. Friend the Member for West Lothian (Mr. Dalyell) asked about the cost of certain aircraft. We shall pay less than £1 million for the Hercules. I am not able to tell my hon. Friend about the running costs. This is a well tried aircraft. It is very cheap to buy. The Hercules is in the tradition of the old DC3 which used to be flown during the war as a jack-of-all-trades plane. This plane has advantages. I can give an approximate, figure for the Phantom of about £1¼ million.
The figure for the Chinook is about £½ million. Last night I gave the figure for the Chinook as £10 million plus support. I think I am right in saying that the figure includes support.
I cannot give the House the precise number of Phantom aircraft bought. The figure which we have been giving is approximate, including the R.N. Phantoms. There will be about 200, but that is not the precise figure. The Phantom is 46½ per cent. British, and the major aspect, 38 per cent., I think, is the Spey engine. I have a list, having just returned from America, of the parts which are British. This might help my hon. Friend and other hon. Gentlemen who would like to know the names of the firms that made them. Four Hercules have been delivered. The fifth will come at the end of the month and will then go into R.A.F. service. All 66 will be in in about one year.
The situation over the Kestrel—the P1127 is slightly different—is that there were tripartite arrangements among the United Kingdom, the United States and the Federal Republic of Germany to build and evaluate nine. After that, and

before the advent of this Government, each country retired to make its own evaluation, which is still taking place. I do not know a great deal about aircraft sales, but while in the United States, I learned that any sales to the United States of this or anything else will be made on merits. There will be no "old boy net" based on the principle that they will buy something because it is British. This is right and should be so wherever we sell in the world.
I cannot obviously, give my hon. Friend the figure which I obtained last week about the radius of action of the F111, nor do I want to give details of the rank of civil servants or air officers who accompanied me. However, the new Chief of the Air Staff, who is to take up his appointment on 1st April, was there.
I was impressed by the firm's evaluations of the aircraft and I spent an interesting time at a meeting at which the F111 was discussed. We have calculated our radius requirements and the performance of the R.A.F. F111 will meet them. The drag has gone down a good deal since the G.D. people were here. I understand that my hon. Friend attended their meeting upstairs.
The radius of action of the aircraft—I think that my hon. Friend wanted details of this under certain configurations—is obviously influenced by the bomb load, the "recce" fit, height and speed. I do not want to go into the rôle too much, because we dealt with it at some length last night.
However, the rôle which we see for the F111 is predominantly reconnaissance. The aircraft is superior in radius and everything else to the AFVG. It is sometimes spoken of as the high-quality part of our variable geometry aircraft, for this reason. I explained yesterday that its long range will make it particularly valuable when the carriers phase out. It is now well known that the first order was for 10 but it should not be thought that these 10 aircraft are for the O.C.U. That is not the case. This may have been one of the reasons why a wrong figure is obtained of the number of unit strength aircraft in the squadrons.
The fixed price for the 10 and the possible 40—the deadline is 1st April, but the final agreement has not been made—


is £2·1 million for all 50. That is as it has always been. There is a supplementary ceiling for the British version with the undercarriage, escape capsule and avionics which the Government wanted to put in. We still see a figure of about £2·5 million, which will include the initial lay-in spares, which are important in the early years, and the later spares, which we will get at the same price as the United States Air Force.
I suggested last night that hon. Members were being unnecessarily suspicious about this. The offset agreement does not pay for the aircraft, but it does safeguard the balance of payments, which was the major reason for it. The agreement, which is for the period of the aircraft, is going very well—

Mr. Goodhew: The hon. Gentleman mentioned that the new supplementary ceiling cost would include the strength of undercarriage. I thought he said last night that this was as standard on the FB111 which is the Strategic Air Command nuclear bomber.

Mr. Rees: I do not know the state of play in American naval aircraft, but the question of standardisation in this run of aircraft has still to be fitted into the production line when this comes in. The cost is greater, because the undercarriage is substantially stronger also. These are the reasons for the increase in cost.
On the AFVG, I should make it clear that, although we discussed yesterday the Estimates for which the Air Force Board is responsible, in the Ministry of Defence we are responsible only for delivered aircraft. That is what this amount is about. I will qualify that in a moment, in regard to subhead H. I therefore have no desire to stop any discussion on the AFVG, but, because it will come into use only in the mid-1970s, the aircraft cannot possibly be under the Ministry's or the R.A.F.'s control at the moment. That could possibly have been discussed yesterday: I do not know. Certainly I take the point that there is room for discussion of future types of aircraft in the Estimates debates.
The difficulty is that I know, from having investigated the matter before yesterday's debate, that the amount of information about the state of play on

the AFVG—this must have been so in the early days of the TSR2, the Lightning, the F111 or any other type of aircraft—which can be given is not very great. Nevertheless, I take the point raised—

Mr. Goodhew: Am I right in saying, therefore, that this type of aircraft purchases abroad might never appear in subhead A but only at a later stage in subhead H? In other words, would we never have an opportunity in these debates to discuss the cost of the aircraft purchased from abroad until after they have been paid for?

Mr. Rees: I was going to qualify this with regard to the American aircraft. The same thing applies to the AFVG and Anglo-French aircraft as to the Phantoms—the cost of the engine will be in the early part of the Vote and the American section will be under subhead H because that is the American expenditure. In any event, we are jumping a long time ahead in trying to discuss how the AFVG will eventually show itself in the accounts.
Vote 7 subhead H is the repayment of principal and interest on loans for aircraft purchased overseas and this account is very much in respect of purchases from the United States. I will explain how this comes about. The hon. Member for St. Albans (Mr. Goodhew) mentioned that, as a result of the dollar expenditure and arrangements made with the United States, the amount of expenditure which appears in the early days, as it were—that is, at the moment—is very small. It will obviously be greater in future, although it is not quite like buying a house, which was the analogy put to me. I agree that in some respects it is like purchasing a house on a mortgage where the repayments every year are the same. There is some similarity between the two transactions, although I understand that there are certain types of house-purchase agreement by which one pays a larger amount in later years.
The figure contained in Vote 7 subhead H is about £9½ million. It might be helpful to the House if I break down this figure and give some information, although, by the nature of things, my figures will be only very approximate. We have purchased about £76 million worth of American equipment, although we


have so far paid, because of the agreement with the United States, about £9½ million. To make the position absolutely clear, in rough figures, we have paid £9½ million for £76 million worth of equipment.
I will give a rough outline of the figures to show how one can break down this figure of £76 million—although I emphasise that my figures are approximate, so much so that they will not even add up. On the Hercules we have so far spent about £35 million. On the Phantom we have so far spent about £15 million and on the Fill we have so far spent about £18 million.
When I was at the Fort Worth plant of General Dynamics I saw, at the beginning of a line, some metal being cut. Someone said to me, "That will be in your version of the F111". I mention that to show that this amount of money is not in respect of completed aircraft but for long leads—the terms generally used to express this stage in an aircraft's production. That is why I cannot give figures which will add up to the £76 million which I mentioned. However, I trust that the information I have given will be of assistance to hon. Members.
It might also help if I explain how the present situation has arisen. On 11th May of last year, just after the General Election, the Military Aircraft Loans Act was passed by Parliament. It was, one might say, a joint effort between the Treasury and the Ministry of Defence. At that time the credits were arranged under that Measure to cover the dollar capital cost of the aircraft. The Act extended the Treasury's borrowing powers so that that Department could take advantage of these credit facilities and make it possible for the Treasury to use borrowed money to relieve the Votes of progress payments for the aircraft and equipment involved. The total cost of the aircraft was £430 million, covering the aircraft, associated weapons, special equipment, initial lay-in spares and dollar expenditure on certain R and D training of air crew and maintenance fitters. When I was at Fort Worth and St. Louis I saw groups of R.A.F. personnel there, as they are in Washington, concerning themselves with these projects.
There will now be periodic instalments until 31st March, 1972—that is, in a

seven-year period. The repayments are made on each borrowing and they are spread over the following seven years in each case. There is, therefore, quite a long period over which these payments are spread and each amount of money is paid during a seven-year period. However, this does not include interest on the loans nor the dollar cost of subsequent spares after the initial lay-in spares have been obtained. The total dollar cost is about 660 million dollars, while 430 million dollars represent the capital part of the cost.
These figures bring us to Vote 7 Subhead H, for it was decided at that time by the Government that, rather than work under the loans legislation of the 1930s—by which the Treasury had power to borrow money for the Exchange Equalisation Account, to look after the balance of payments and so on and then to use the money to buy aircraft—the Department should maintain accountability to this House as progress payments were made each year through the Ministry of Defence to the United States contractors. Thus, each year an equivalent sum should be included in the Votes which are presented with the Estimates to Parliament.
I have attempted to break down the figures in Vote 7 Subhead H, although I admit that I have done so in a rough and ready way. It was the Government's intention, in the Military Aircraft Loans Act of last year, to enable this House to keep its eye on the progress payments made because of the new arrangements for the purchase of aircraft from abroad. I hope that the right hon. Member for Wolverhampton, South-West, who raised this question of accountability—and it is right that there should be room to look afresh at these matters in the light of our new responsibilities and for hon. Members to seek information about the figures—will agree that Vote 7 Subhead H appears as a result of the Government's firm intention to arrange business in such a way that the House can ask questions about these American aircraft.
The fact that the AFVG aircraft do not appear in the Vote is because their stage of completion is such that expenditure on them is extremely small. It is, therefore, not possible at this stage for the figures concerning these aircraft to appear in the accounts.

Mr. Powell: Obviously the figure that is missing in the form of the Estimates is that of £76 million. That is missing completely and, of course, a breakdown of it is equally missing.

Mr. Rees: I agree, and that is why I have given a rough and ready breakdown of the figure. I hope that the breakdown I gave enabled the right hon. Gentleman to see what is happening.

Question put and agreed to.

Resolved,
That a sum, not exceeding £268,000,000 be granted to Her Majesty out of the Consolidated Fund, to defray the expense of aircraft and stores, which will come in course of payment during the year ending on 31st March, 1968.

Vote 8. Miscellaneous Effective Services

Motion made, and Question proposed.
That a sum, not exceeding £2,680,000 be granted to Her Majesty out of the Consolidated Fund, to defray the expense of miscellaneous effective services, including certain grants in aid and a subscription to the World Meteorological Organisations which will come in course of payment during the year ending on 31st March, 1968.

6.50 p.m.

Mr. Goodhew: I am sure that my right hon. and hon. Friends will want me to say how grateful we are to the Under-Secretary for the valiant way in which he has coped with the difficulty of answering a lot of detailed questions at short notice. He knows that it is not our wish that it should be so, and I hope that note will be taken for the future so that we can return to the customary practice of giving each other notice behind the scenes of the sort of questions we are likely to ask, so that Ministers can as far as possible give detailed answers. We would much prefer to do it that way, and hope that the future programmes will be so arranged.
I would add a plea that a look might be given at the old question of classification. I am certain from my own visit with other N.A.T.O. Parliamentarians to American military establishments, including the Strategic Air Command Headquarters, that we are quite unnecessarily strict over our classification of Service affairs and equipment. The Americans take a different view. They say that if it is believed that the Services are a deterrent, it is good for people to know

something about them. There is a lot to be said for that view. We could have had a better debate on these Estimates if we were not quite so conscious for the need for classification.
I note that the amount shown under Subhead A(1)—telecommunications—has increased by about £400,000. I was fascinated to see this, because it made me wonder whether it meant that work was being done to build a communications satellite. The Under-Secretary gives me a negative nod and it disappoints me, because I think that this is a sphere in which there is great scope, not only for the application of our technology but for earning valuable foreign currency. I am saddened to know that the £400,000 does not indicate entry into that line.
I see that the cost of publicity and recruiting services is up by £5,000—from £75,000 to £80,000. This is rather surprising seeing that we are running down the R.A.F., but perhaps we find it necessary to advertise more frequently to make sure that it is known that people are still wanted in the Service even though it is being run down.
Apart from the complaint I made yesterday about anticipation, I think that the R.A.F. publicity department does a very good job, and that its advertisements are most appealing. I am sure that if I were a young man thinking of a career I would be very much attracted by that advertising if I were not hampered, as I am, by my spectacles, which prevented me flying in the R.A.F. during the last war.
Welfare expenses show a considerable reduction. Does the sum shown include an allocation for special arrangements for the bringing home of bodies, or the conveying at public expense of relatives to the burials of those who die overseas? That may not come within this Vote, but I would expect that Vote to be increased rather than reduced.
The amount under Subhead K—Administration of the Sovereign Base Areas of Akrotiri and Dhekelia—is up by quite a large amount. I was under the impression that, if anything, we had reduced our strength in those bases, and I would be interested to know—if not today, later—whether that is so, or whether it is merely a question of increasing cost.

6.55 p.m.

Mr. Merlyn Rees: It will be found that the reason for the increased cost in Cyprus is nothing catastrophic, but is probably an increase in personnel. I will let the hon. Gentleman have the full answer later.
The item of telecommunications covers rentals and maintenance charges made by the Post Office for telephone, teleprinter and other telecommunication services, and hire facilities abroad. The increased cost is due to the increased requirement for the linesman-mediator traffic control setup we are opening at West Drayton. It appeared in the newspapers recently as the "deadman mediator," but the correct name is linesman-mediator. This is a joint civil and military air traffic control network, and there is a great deal of contact between the Board of Trade and the Ministry of Defence.
This is a very great development, and is at low level and at high level. There is a defence aspect in the low-flying R.A.F. planes, but on the civil side there is the very great problem of large numbers of fast-moving aircraft whistling around the skies and coming in to London Airport. The telecommunications side is obviously of great importance.
I spent some time the other day at Uxbridge and at London Airport visiting R.A.F. personnel working jointly with the civil side. Their work consists of staring all day at radar screens, picking up aircraft coming north and south, long-distance from the United States and from the Continent. It is a remarkable job and, as I say, the West Drayton development is extremely important. It is the reason for the increased expenditure.
I should point out that under publicity are such items as exhibition display material and classified advertising in connection with recruiting. It also includes the printing costs of the R.A.F. newspaper. The costs of large-scale Press and poster advertisements are borne on a different Vote—that of the Central Office of Information—so the item here shown represents a very small part of the total publicity expenditure. I believe that the total expenditure for the three Services is about £3 million.
I would justify that expenditure in this way—because I know that there is ad-

verse comment in view of the fact that the Services are reducing. It is not just a question of the Services declining in size. We have to recruit young people, on the one hand and, on the other, people of the right trade. As was said when we debated an earlier Vote, the R.A.F. has never recovered from giving up recruiting altogether in 1963. I will not repeat what I said earlier about the curious situation that arises at the time of a General Election, when all recruiting posters and expenditure have to stop lest they should brush on to the Government of the day some kudos in the election. Nevertheless, that is the fact. It is important that recruiting should go on.
Welfare expenses provide mainly for live entertainment for R.A.F. units, the upkeep of sports gear and equipment, and charges for the supply of films to R.A.F. hospitals and ocean weather ships. This reference gives me the opportunity of saying that I recently spent a longer period than I had hoped in an R.A.F. hospital, so I am able to pay tribute to the great services provided by the R.A.F. hospital branch. The sister who looked after me will be very glad that I got in that remark.

6.59 p.m.

Sir Eric Errington: Before the hon. Gentleman sits down, may I ask him to explain the item relating to the repayments under the terms of the Armed Forces (Housing Loans) Acts arising from the sale of married quarters? What is the reason for this contraction? It seems somewhat unusual when every bit of accommodation is wanted.

Mr. Rees: I apologise to the hon. Gentleman, because I do not know the answer now I will look into it and write to him.

Question put and agreed to.

Resolved,
That a sum, not exceeding £2,680,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of miscellaneous effective services, including certain grants in aid and a subscription to the World Meteorological Organisation, which will come in course of payment during the year ending on 31st March, 1968.

Orders of the Day — DEFENCE (NAVY) ESTIMATES 1967–68

Vote 1. Pay, &c., of the Royal Navy and Royal Marines

Motion made, and Question proposed.
That a sum, not exceeding £97,465,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the pay, &amp;c. of the Royal Navy and Royal Marines, which will conic in course of payment during the year ending on 31st March, 1968.

7.0 p.m.

Dame Joan Vickers: I want to take up one or two points that I have not been able to refer to before, particularly the case of the separation allowances. The new separation allowance, to be paid from 1st April, 1966, is to be paid to married officers and ratings serving abroad or on seagoing service or on service in certain conditions which means that they are unaccompanied by their families.
I hope that the Under-Secretary of State will tell us what these "certain conditions" are and why this separation allowance is given to the men. It is much cheaper for a man to live alone overseas. He goes to a mess and it seems unfair that because he is married he gets the extra money while the unmarried man messing with him does not. Also, unmarried men also get lodging allowances when on land.
If there is need for separation allowance, it should surely be paid to the wives and families left behind. A wife left behind in these circumstances faces extra expenses. There is no man about the house to help with various things about the house. It is the woman who has to pay for the babysitter or the domestic help and she is thereby penalised when her husband is away. It is she who should get the extra money by way of separation allowance.
I would be grateful if the hon. Gentleman would explain this. This is the first time we have really been able to raise the subject. The hon. Gentleman should consider whether this provision should not be paid direct to the wife who, as I say, is the one who suffers most from separation. She has to incur the extra expense. Admittedly, when I was overseas, men told me that it paid them to be separated because they got this extra money, which works out after

one year's service at 28s. a week. That would certainly be helpful for their wives, however.
Another point is that of the disturbance allowance. Here there is provision for disturbance allowance for officers of £40 and for ratings £25 when they move into furnished married quarters or official hirings. I do not know why there is this differentiation. Surely they incur equal expenses. If a rating has to move bag and baggage, one cannot say that he can do so at a cheaper rate and surely in these circumstances he should have an equal allowance for moving to furnished married quarters or an official house.
Possibly, if the move is to private accommodation—when an officer gets £80 and a rating £50—this might conceivably be just because, presumably, the officer might have to take more furniture and so on. Nevertheless, the difference of £30 is very great. From my own experience involving people moving from Portsmouth to Devonport, however, I know that they are put to considerable expense in moving their furniture and very often ratings have far more need to bring their bag and baggage, perhaps including perambulators for the smaller children.
I would be grateful if the hon. Gentleman would go into these two points and consider the allowances involved, perhaps giving wives better treatment. It does seem unfair that, as the separation bears more hardly on wives and families than on the husbands, the extra payment for being separated should go to the husband.

7.7 p.m.

Mr. Emrys Hughes: I want to address questions to my hon. Friend the Under-Secretary of State about the Polaris submarine base at Gare Loch. Hon. Members will be aware that I have been asking a series of Questions about this matter over a period of months. The subject has aroused considerable interest in the West of Scotland where, at present, there is a shortage of construction labour and delay in the building of essential schools, hospitals, advance factories and so on. At the same time, however, there has been intensive activity on the submarine base.
I understand that the sum involved in the base is about £45 million, which is a very considerable amount, especially


at a time when we need construction labour somewhere else. Many of us are anxious to know when the activity on this base is likely to be completed so that the construction and building labour can be transferred elsewhere. Last week, my right hon. Friend the Minister of Transport announced a new terminal at Greenock.

Mr. Deputy Speaker (Mr. Sydney Irving): Order. The hon. Gentleman is going wide of the Vote. He cannot discuss matters other than the pay of the forces involved in this vote.

Mr. Emrys Hughes: If you will allow me to carry on for a few sentences, Mr. Deputy Speaker, I will show that this is directly related to the Vote.
My argument is that, while this construction and building labour is engaged on the submarine base, it cannot be used in any other part of western Scotland. I do not want this labour to be engaged on work that is given priority over more essential work.

Mr. Deputy Speaker: Order. I think that the hon. Gentleman is talking about labour employed in the construction of the base. All he can talk about are the personnel involved whose pay comes under this Vote.

Mr. Emrys Hughes: There is a considerable naval personnel employed at the base. Obviously, the construction at the base is covered by this Vote. I know what I am talking about, because I have been there. My hon. Friend the Member for West Stirlingshire (Mr. W. Baxter) and I spent some time at the base recently and we want some assurances about it.
At the base, there is a submarine school. It is a very expensive school because, as far as I can make out from the Navy Votes, the cost £7½ is million and a Ministry of Public Building and Works Vote is also involved. One must add these two sums together to find out the exact amount of money being spent at the base.

Mr. Deputy Speaker: Order. It is certain that that amount of money is not on this Vote. The hon. Gentleman must keep to this Vote.

Mr. Emrys Hughes: Surely this Vote is for employing the men, and I submit that what I have said is relevant to it.
However, I shall leave that and come to the question of exactly how many officers and men of the Royal Navy are to be employed in this base, and for what purpose.
Presumably, they will he trained at this school. I have tried in vain to extract from the Ministry of Defence exactly what will be the cost of training these officers and men. It is an enormously expensive school. When I asked how many instructors were to be there I failed to get any answer at all. I would, therefore, like to know a little more about the activities of this school.
I come now to consider the purpose of the Polaris submarines. We are voting money for men who will be employed on these submarines. I understand that each submarine will cost £50 million, and that the cost of the crew is likely to be considerable. What will be the cost of running a Polaris submarine, and for exactly what purpose are these men to be trained?
I understand that they are to be trained to man a submarine which will carry a guided weapon missile which, at the time it was ordered, was supposed to be a useful deterrent missile and one which would be able to penetrate the defences of a potential enemy. That was some years ago. I have here an article by the military correspondent of The Times of 8th August, 1967. It deals with the new submarines, and points out that only by spending a considerable further amount of public money will these missile submarines be brought up to the standard of the submarines which are now being built by the American Navy.

Mr. Deputy Speaker: Order. The hon. Member is getting a little wide of the personnel involved in this Vote. He is now talking about wider considerations of defence, of total expenditure, and the whole aspect of the Polaris submarine He cannot do that on this Vote.

Mr. Emrys Hughes: I presume that we are employing these men, and we have an idea of what they are to do. What I would like is an assurance from the Minister that we are not going to employ a further number of men and incur additional expenditure at this Polaris base. I asked my right hon. Friend the Secretary of State for Defence whether he would give me an assurance that there


would no further expenditure on the Polaris submarines other than that already announced, and the answer which I received was "No".
I find this answer very strange, because we thought that the number of men who were likely to be employed had been fixed by the fact that there were to be four Polaris submarines. I therefore look with a certain amount of apprehension at what is going on at Gareloch. I believe that we are to employ officers and men to do something which the Minister has not properly explained. I therefore say that we should not agree to pass this Vote for the number of men who, presumably, are to be employed on submarine warfare until we have a clear idea of what they are to do.
Under whose direction will these submarines operate? During the defence debate an Opposition spokesman said that they were to be an independent force, but that is not what they are to be. According to The Times of 8th March—

Mr. Deputy Speaker: Order. I think that the hon. Member knows very well that, important as the subject he is discussing is, it is not in order on this Vote. I must ask him to confine himself to the question of personnel, and not to go into wider considerations of defence policy, which he is doing now. I am sorry, but I really must insist.

Mr. Emrys Hughes: If we are not to be told what the personnel are to do, this debate is meaningless. I therefore suggest that when we are voting money for a considerable number of men we are entitled to know what they are likely to be doing. The defence correspondent of The Times said—

Mr. Deputy Speaker: Order. The hon. Member has had other opportunities to raise this matter. This is a very narrow debate, on a very narrow Vote, and the hon. Member really is taking the debate far too wide. I really must insist that he does not pursue this any further.

Mr. Emrys Hughes: That restricts the discussion on the whole policy of the Polaris submarines, but, of course, I obey your Ruling, Mr. Deputy Speaker.
It does, nevertheless, create a curious state of affairs, in that although we are discussing naval policy we cannot discuss the Polaris submarines and what they are to do.

Mr. Deputy Speaker: The Chair only operates the rules which the House has laid down. It has been the practice not to allow debates other than on the subheads of the Vote on these occasions, on the understanding that the policy has been laid down on other occasions, and discussed during other debates.

Mr. Sydney Silverman: On a point of order. I am not a Member for any part of Scotland, and I have no particular interest in the Scottish aspect of this matter, but I gather that the Vote is intended to cover the building of a nuclear submarine. [HON. MEMBERS: "No."] If I have got it wrong, no doubt the Chair will correct me. But if that is even remotely so, it can surely not be out of order to point out that there are doubts about the effectiveness of what the money is being spent for to carry out the object which the Government intend to carry out.

Mr. Deputy Speaker: I understand the hon. Member's anxiety, but the precedents are quite clear on page 762 of Erskine May under the heading, "Relevancy in debate" relating to Defence Estimates. On the Vote which we are discussing today, while hon. Members may discuss the details of the subheads, what we cannot do is to have a general defence debate, or a general foreign affairs debate. While the hon. Member for South Ayrshire (Mr. Emrys Hughes) was attempting to use this occasion to discuss wider issues, he was really getting out of order, and I regret that I had to stop him.

Mr. Silverman: Further to that point of order, Mr. Deputy Speaker. I follow that it would be completely out of order to extend the debate into questions of foreign policy, or even of defence policy, but I did not understand that my hon. Friend was attempting to do that. All he was questioning was the practical usefulness of the particular expenditure under the Vote. Surely the House of Commons must reach a conclusion about that before deciding whether to afford the money or not.

Mr. Deputy Speaker: The precedents are quite clear. Only the matters within the subheads can be discussed on this occasion.

Mr. Archie Manuel: On a point of order. May I have your guidance, Mr. Deputy Speaker? I understand that the effective Vote covers the officers and men employed in the Polaris submarines coming into service at the Gareloch. I understood my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) to be dealing with that, in rather a lengthy way, perhaps, and going rather to the perimeter, but being principally concerned as to how much of the effective Vote would be set against the extra men who would be employed on those submarines. If that were so, would it not be enough?

Mr. Deputy Speaker: The only subject which is in order in this debate is discussion of the matters within the subhead, namely, the pay of naval personnel. So long as the hon. Member restricts himself to a discussion about pay, he is in order. What he was doing, however, was using this occasion to bring in wider considerations of defence policy regarding the Polaris base and the use of the Polaris submarine. That was out of order.

7.21 p.m.

Rear-Admiral Morgan Giles: I have two questions to put on this Vote, both arising from a previous debate on the Navy Estimates.
First, on the subject of housing loans for officers, there has as yet been no satisfactory reply to the questions which I raised on 1st March. The Undersecretary of State said
… we will consider it".—[OFFICIAL REPORT, 1st March, 1967; Vol. 742, c. 664.]
Has he done so, and has he an answer to give?
Next, the question of overseas allowances. On 1st March I asked the Undersecretary of State about our retention of facilities in Malta, and he promised to write to me about it. Now, nearly a fortnight later, I have had no communication. I should be glad if he would answer that, too.

7.22 p.m.

Mr. Christopher Mayhew: I should like to know about the

principles on which Service pay generally, and Navy pay in particular, is to be based in future. We all recall the critical situation at the beginning of last year when the Services pay claim was referred to the Prices and Incomes Board. I felt at the time that this was a wrong procedure in the circumstances. The Services were then governed by the Grigg recommendations, and Service men, in their special contractual relationship with the Government in this matter, had fallen very much behind. It was decided to send the Services pay claim to the board and, fortunately, the board made a recommendation to the effect that the Grigg principles were to apply. That is what came out of the wash.
It was decided also that new principles would be worked out for Services pay and that these would be discussed at length with, I think, the Treasury. What stage have the negotiations reached? The House should be particularly sensitive on the question of Services pay, bearing in mind that Servicemen have no trade union, they cannot strike, and they are very much at the mercy of the Government and Parliament. We must be quite sure that the principles applied in determining Services pay in the future are acceptable to the House.

7.23 p.m.

Mr. George Willis: Will my hon. Friend say something about the skilled men in the Navy and whether sufficient are being obtained to do the additional work which, undoubtedly, will be imposed upon the engineering and artificer branches and other skilled branches as the result of the Polaris programme?
It is a long time since I made a speech on the Navy, but I used to make quite a few, and one of the matters which concerned me was that the Navy was desperately short of skilled men. In fact it could not man its ships adequately. At one time many ships were undermanned because of the shortage, and it was clear that the Polaris programme, which demanded two crews, practically all skilled men, would impose a still greater burden.
What progress has been made in the recruitment of these men? I find it difficult to understand, from a reading of the Defence White Paper, exactly what is happening. For example, in paragraph


29 on page 70, dealing with re-engagement in the Royal Navy, we are told:
We believe that the re-engagement bounties paid to skilled men in certain shortage categories and an assisted house purchase scheme have contributed to this improvement.
When I looked for the improvement, I found that all that had happened regarding 12-year engagements was that the rate of re-engagement had remained stable. In other words, it had stopped falling. That might be an improvement—it depends on how one looks at it—but, if the number was inadequate before, I hardly think it an improvement if it stops at that level.
This is a matter about which we ought to be concerned. I raise it now because a great deal of thought has been given to it over past years, and many suggestions have been made as to what might be done. I notice that the artificer branch itself is still putting forward constructive ideas to the Admiralty about it. I hope that my hon. Friend will pay attention to the current issue of the Naval Engineering Review, which discusses this matter. It makes a number of proposals regarding the structure of the engineering and technical branches, some of which no doubt, will frighten the Admiralty, but which, nevertheless, make a good deal of sense.
Suggestions are made in the Review about pensions and re-engagements, and it is suggested that if, as the Defence White Paper says, the policy of giving re-engagement bounties has been useful, we should consider it further and think of the possibility of paying more than £750 to the 12-year re-engagement man. If he leaves, it costs anything between £5,000 and £10,000 to train someone to take his place. It would not be a bad idea, therefore, to reconsider this figure and look at the possibility of saving money in the long run by increasing the amount we pay to induce men to stay on for the longer period.
It is suggested, also, that men might be given the opportunity to re-engage for five years instead of for 12, without necessarily receiving a pension at the end of the five years. They would simply be given the opportunity to stay on for another five years, by which time they would still be only 35, an age at which a man can come out and fit himself into civilian life. This idea, too, is well worth looking at.
The Review suggests that the re-engagement grant should be divided into a sum to be paid when the re-enagement papers are signed and another sum to be paid at the conclusion of the man's service. This, too, might be a good idea. All these are useful suggestions.
The Admiralty—we still call it the Admiralty, do we not, althought it was once the idea that we should call it the Navy Department, and we had a long debate about it—the Admiralty ought once again to look at the question of structure. In past years it often looked at the idea of creating a master rating. That was turned down and the proposition is now put forward that there should be a special Navy engineering branch, that the artificers' and mechanicians' branches should be re-examined with a view to creating an engineering branch with a better quality of more highly skilled technical men, able to perform the more skilful work, so that artificiers do not waste a lot of their time doing work which could be done by less skilled men. Perhaps there could be an increase in the numbers in other branches, such as the mechanicians' branch, by recruiting men already in the Service to undertake the less skilful work, leaving the most skilful work to the artificers.
I remember long discussions many years ago on how best to get men to do the very skilful work. Let us make no bones about it now. The chief artificers in all branches must perform increasingly highly technical work and must have a knowledge and skill to enable them to analyse defects, and matters of that kind, if they are to be employed economically.
I therefore ask my hon. Friend to give us some information on how recruitment is going, whether we are still short of skilled men and shall be able to meet all the demands that will be made for them, and whether he will consider in a constructive manner the propositions now being put forward to enable the Service to meet its requirements.

7.32 p.m.

Mr. Patrick Wall: I had not intended to speak on this Vote, but the speech of the hon. Member for Edinburgh, East (Mr. Willis) has persuaded me to intervene briefly.
When we concluded the debate on Vote A the other day the Under-Secretary of State for Defence for the Royal Navy got rather cross, and to rebut some of my criticisms quoted re-engagement figures which I did not fully absorb at the time. I have now had a chance to do so. For the 12-year men, the backbone of the Royal Navy, the re-engagement rate in 1959 was 65 per cent.; in 1963 it was 54 per cent.; in 1965 it was 52 per cent.; and the Under-Secretary of State said in winding up that debate that it was now 45 per cent. On the point made by the hon. Member for Edinburgh, East, is he really satisfied with those figures, and does he think that they denote that all is well on the question of re-engagement in the Royal Navy?

7.33 p.m.

Mr. Tom Driberg: I agree with much that my hon. Friend the Member for Edinburgh, East (Mr. Willis) said, but I wish to make one point in slight modification of it. He may well be right in saying that the Navy is short of skilled men, and I agree that everything must be done to attract and keep in the Navy the skilled men of whom he spoke.
But, however important it is, the technical efficiency of the Navy should not have an absolutely overriding force over every other consideration. There are very difficult cases, such as applications for compassionate discharge and so on, which are often turned down on the ground that a skilled man cannot be spared. It seems to me to be very unfair, and not good for morale in the Navy, if there are two ratings with equally strong compassionate claims but one of them is skilled and one unskilled, and the unskilled man nets his compassionate discharge while the other does not.
There must be a balance—and I am sure that the Navy tries to achieve such a balance—between pure considerations of technical efficiency and the claims of compassion, the ordinary human claims, the claims of justice to the individual as well as the technical claims of the Navy.

7.35 p.m.

Mr. Eric Ogden: I wish to make one very brief point, and I assure the House that my hon. Friend the Under-Secretary of State

for Defence for the Royal Navy does not know what I want to raise. I also assure him that I do not expect him to answer, because although it is directed to him through the Chair it will ricochet off to my right hon. Friend the Secretary of State for Defence.
We have talked a lot about pay, and pay is closely linked with status. Status has an important rôle to play in the Royal Navy, with such titles as "Board of Admiralty", "Lord High Admiral" and all the others. The man with particular responsibility has one of the longest titles in the Government—Under-Secretary of State for Defence for the Royal Navy. How can he possibly hold equal conversations with his Service officers with a title like that? His title could well be, "Minister for the Royal Navy", which is simple, short, sweet and very effective.

7.36 p.m.

The Under-Secretary of State for Defence for the Royal Navy (Mr. Maurice Foley): In starting this debate, the hon. Member for Plymouth, Devonport (Dame Joan Vickers) touched on two very human matters. I know of her concern in such matters and would expect that they would be the kind of subjects she would raise. The hon. Lady raised the question of the separation allowance which is shown in Vote 1 (B) and (D), and the disturbance allowance. The separation allowance, which is 4s. a day, was introduced on 1st April, 1966. It is payable to married personnel who have been separated from their families for at least 12 months because of service outside the United Kingdom.
It is also payable to naval personnel appointed to certain seagoing ships on home sea service and serving home legs of general service commissions. Because the incidence of separation increases with service, particularly in the Navy, a Serviceman who has completed nine years' service and has been separated for three years qualifies for an allowance of 8s. a day. That accounts for a cost in the 1967–68 Estimates of £116,000 for officers and £761,000 for ratings.
The hon. Lady suggested that the payment should be made direct to the wives. That would be against our normal practice and would introduce a new principle which I am not sure that the husbands would welcome. Nevertheless, I


shall look into the matter and write to her on it.
Similarly, she referred to the hardship that can face families under disturbance allowance. I am not quite sure that I got her point. She seemed to say that the ratings' allowance was less than that for officers, that the ratings often had a young family and that therefore there was hardship. I was not aware of it, but I shall look into it. The allowances are reviewed from time to time, and if one can establish need that is how change is effected.
The hon. and gallant Member for Winchester (Rear-Admiral Morgan Giles) raised the question of assisted house purchase in the debate on the Navy Estimates and has again touched on the subject today. This scheme, under which ratings are given an advance to help them buy their own houses, was introduced to encourage men to stay on in the Navy after their first period of engagement had been completed. It was a device to give security and encourage re-engagement. That was made clear when we discussed the Navy Estimates and to the Fleet when the scheme was introduced. It has proved very popular.
It seems that the other two Services are anxious to follow the Navy's lead. I emphasise that the purpose of the scheme was to encourage long-serving men to re-sign and to give them a sense of security for the future. Not all ratings are eligible or qualified. They must have signed on to complete a total of 22 years' reckonable service.
The scheme is popular and has been undoubtedly valuable in influencing ratings to re-engage. That was the original purpose of the scheme. Officers are differently situated since the question of their re-engagement does not arise. Help over house purchase in their case is being considered. No decision has been reached, but I recognise the validity of the point made and it will be followed up.
The hon. and gallant Member also raised the question of Malta and the use of Malta. I confess that in our last debate my answer was totally unsatisfactory. That was because it was made at a time when delicate negotiations were going on. It would have been wrong to hint or promise, or indeed to

introduce a new factor to those negotiations. Now that the negotiations have been settled, the opportunity arises to look at the question again. I promise that this will be done with expedition.
My hon. Friend the Member for Woolwich, East (Mr. Mayhew), who not so very long ago was at this Dispatch Box dealing so adequately with this whole subject, has raised the question of Service pay. He will be aware that this affects all three Services and also that under the Grigg formula any increase in pay would not be effective until 1st April, 1968. That gives us some measure of time and discussions are still going on with the Treasury. There is no firm decision, but there is no question of lethargy on our part. We are anxious to make sure that the Navy, in terms of Service pay for ratings and officers, is put right, and that they feel—this is a real contribution to their morale—that they are supported by the nation in their work.
My hon. Friend the Member for Edinburgh, East (Mr. Willis), who was speaking so eloquently on this subject long before I came into the House, and speaking with a great deal of knowledge and feeling, touched upon a number of points which are of prime importance. I will look at the question about manpower, which was also raised by the hon. Member for Haltemprice (Mr. Wall). In no measure can we be complacent or satisfied about this. If hon. Members look again at the figures which were given when introducing the debate on the Navy Estimates and in the rather scrambled wind-up, they will see that there are shortages. There are shortages of skilled technicians and undoubtedly these are key men on which the Navy depends. We must look again and again to see how we can keep, encourage and produce the kind of person required in terms of the manning of modern sophisticated ships and their weapons systems.
I will look at any suggestions advanced. My hon. Friend suggested a publication and I will look at that suggestion. We are anxious all the time in this respect. To help in this we introduced the re-engagement grant scheme in 1965. It was introduced for a two-year period to relieve the shortage of design and technical ratings. Grants are made for those to reengage for nine or 12 years and for 22 years. The scheme originally allowed


grants of £750 to certain ratings in weapons, radio and electrical categories and for A.R.A. ratings the grant was increased to £750. Shortages in these technical categories still continue to be serious. Despite this, we hope that the grants may change the drift into an increase.
This is part of the constant re-examination and reflection which we must be making to improve matters and to see what more is needed. I accept the point made about manpower by my hon. Friend the Member for Barking (Mr. Driberg). I am aware of his concern, particularly about constituency cases in addition to his general concern. We do not want people to be kept in the Royal Navy against their will. That will not do any good whatever for the morale of the force. Nevertheless, there is equally the case which we must look at that considerable finance is spent on training people.
I have spoken about A.R.A. and technical qualifications which are required. If the State is to pay, as it does, for the training of someone for five or seven years, the State should expect a measure of return. This does not mean that these matters cannot be re-examined, including those concerning the junior end and the question of the break point. This has been raised in discussion of each individual Vote and also in an Adjournment debate. It is a matter of anxiety to many of us, and it will be looked at. I do not believe there is a hard-headed attitude towards compassionate cases. In the short time I have been in the Navy Department I have had to deal with 20 or 30 such matters and at least half of them have been settled very quickly. There has been a measure of humanity and concern and speed in dealing with them. We must be constantly examining and looking at this problem.

Mr. Driberg: I am greatly encouraged by what my hon. Friend has said. Can he say that the inquiry which has been promised into the particular matter which I raised, and my hon. Friend the Member for Eton and Slough (Miss Lestor) raised on the Adjournment, will take place pretty speedily?

Mr. Foley: The question is not one particularly for the Navy, although the

Navy has a measure of concern which is perhaps greater than that of one or other of the other Services because of the greater intake of juniors. The Minister of State for Administration has promised this inquiry. He is actively concerned in it. It will be an across-the-board, three Services re-examination of the reasons which people give for wanting to leave, the age at which this emerges and the pattern it follows, to ascertain at what point it would be in our interests and the interests of the Service and those concerned to establish break points. I cannot promise that there will be an answer in a matter of weeks, but there is a degree of urgency. We are anxious to present the Armed Forces in a good light and to demonstrate that there is a humanitarian concern within their ranks.
I mention briefly, and I shall try to keep in order, the point raised about manpower on Polaris in terms of naval personnel. As the White Paper said, there is something of the order of 900 personnel expected in this year to serve in the Polaris programme. As my hon. Friend the Member for Edinburgh, East said, it is expected that when the four Polaris ships become operational there will be two crews for each of the submarines and a standby crew, making nine crews in all. That is the total 900 provided for in this year's Estimates for the base at Faslane.
My hon. Friend the Member for Liverpool, West Derby (Mr. Ogden) commented on the nomenclature. Fortunately, having been at the Navy Department for about six weeks, I am able to say that I am starting to get on first names terms with many people and that long-winded titles are dropped very quickly. It may be that in time we may look again at the question of names, but I hope that we shall be judged much more on what we do than on what titles we have.

Question put and agreed to.

Resolved,
That a sum, not exceeding £97,465,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the pay, etc. of the Royal Navy and Royal Marines, which will come in course of payment during the year ending on 31st March, 1968.

Vote 4. Research and Development and other Scientific Services

Motion made, and Question proposed,
That a sum, not exceeding £34,655.000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of scientific services, including a subscription to the International Hydrographic Bureau, which will come in course of payment during the year ending on 31st March, 1968.

7.50 p.m.

Mr. Wall: During the conclusion of our debate on Vote A last week, I expressed concern about the morale of the Royal Navy and particularly of the officers. I made it clear that this was due to the Governments failure to appreciate the true rôle for the Navy and uncertainty about the future of certain types of ships and particularly of weapons.
Vote 4 relates to research and development and, therefore, perhaps more than any other Vote, concerns the future of the ships and the missiles which we can expect in the Fleet in the next 10 years. The Opposition therefore feel that we must spend some time in probing in some detail on this Vote. I do not apologise to the Minister of State in advance, because most of the matters which I wish to raise—and I believe that the same is true of many of my hon. Friends—were raised in the debate on Vote A. I therefore hope that we can now receive answers to some of the questions which were not answered in the short time available for the Minister to wind up that earlier debate.
There has been much talk from the Government benches about cuts in defence expenditure. Indeed, it has seemed to some of us that some hon. Members on the back benches opposite do not want to cut defence expenditure so much as to abolish it altogether. I am, therefore, particularly pleased to see that the amount allocated to research and development under Vote 4 has increased over the past three years. In 1965–66, it was just over £28¼ million, in the following year it was a little over £31¼ million, and this year it is just under £35½ million. That is an increase of about £7 million in three years, and I congratulate the Government on this, because this is extremely important for the Fleet of the future.
I want particularly to discuss Subhead A—Pay and Allowances—and Subhead B, which concerns ships, hulls and machinery, weapon systems, radio and navigational equipment, scientific research and technical services, and so on. That covers practically all the hardware of the Royal Navy now or in the future. These are the "teeth" of the Royal Navy and paragraph 15 in Chapter IV of the Statement on Defence says:
New ships, which the Royal Navy will need for its future tasks, are being planned …
If that is so, I hope that we will be able to get answers to some of the questions which we put this evening.
I should like to start by discussing ships' hulls. A very strong case was made from this side of the House during our previous debate on the need for a cheaper aircraft carrier. It is obviously impossible for the Government to guarantee that forces employed say in the Indian Ocean area would be employed only where there was no opposition. I referred previously to the "red carpet treatment". Therefore, any maritime force, whether naval or ordinary merchant ships going about their lawful occasions in time of war, would need air protection. What happened to the "Prince of Wales" and the "Repulse" demonstrated what happens when there is not adequate air protection.
It was made crystal clear in last night's debate that the so-called island base strategy could not provide the air protection required by either naval units or the merchant services in time of war. I merely remind the Minister of State that I made the point that the lessons of Vietnam, which are the most modern lessons possible, show what use can be made of the aircraft carrier. I see that the hon. Member for South Ayrshire (Mr. Emrys Hughes) is about to rise and I know which words caught his ears, so I will hastily put my question. I want to know what research and development are being put into the development of a cheaper aircraft carrier hull.
It is not for the Opposition to explain the details, but it is our concept that a much cheaper aircraft carrier could be built than the CVAO-1 on a form of hull such as that of an oil tanker. Such a carrier could probably be produced at


less than half the cost of the conventional carrier—it might be a smaller vessel—and it could certainly operate vertical takeoff aircraft such as the Harrier which would be manned by both Navy and R.A.F. personnel, so that there would be complete flexibility and interchangeability between the two Services. Only in this way can there be a maritime strategy in areas such as the Indian Ocean or the Pacific.
It is true that with a hull of this size and a ship costing about £20 million one would have to have all the very expensive radar and communications equipment and guidance systems in a smaller ship, and it will be recalled that we suggested that it should be concentrated in a frigate from which, with modern computer techniques, to provide the necessary information for the vessels which we have dubbed "Healey carriers".
I hope that we shall be told that a certain amount of research and development is going on into some such vessel so as to give the Fleet naval air cover from naval ships, because we do not believe that, even with the modern American aircraft which we are buying that this cover can be provided from mainland or island bases which may or may not be swamped as some of them, as we heard last night, have only a 5-foot freeboard, if I can use a naval term.
The Government are obviously putting some research and development into the refitting of the three "Tiger" class cruisers. These are fine vessels, although I remember that when hon. Gentlemen opposite were in opposition they begged us not to continue with these vessels, which in the event have proved to be very useful. They are being equipped to take helicopters—I think, four Sea King helicopters. I wonder whether this kind of dual purpose ship, with guns forward and helicopters aft, will be of value. It may he recalled that the Japanese developed this type in the last war and that the two ships concerned did not serve very useful purpose.
The point I am trying to make is that instead of spending more on the research and development needed to convert these three cruisers into half cruiser and half helicopter carrier, it may be better to spend the money on developing a cheaper

form of aircraft carrier which could not only guarantee air protection to the Fleet, and to other surface vessels, but make it possible to have an effective strategy in the Indian Ocean area. We do not believe that a maritime strategy can be exercised in the oceanic areas of the world unless air cover is provided from some form of ship.
I turn now to another form of hull. This is a matter which I have raised in previous debates on Estimates. There is a need for research to see whether we should follow the Americans in adapting older ships, or building new ships, as headquarters ships. I commend the example of the U.S.S. "Northampton", or of the small aircraft carriers now being converted into headquarters ships. It would be well worth spending money on this form of concept. We would then have one ship which could operate naval or maritime or amphibious forces and have the communications equipment and all the essential electronics which are necessary for these operations.
At the moment, we have a large command headquarters in Aden with a large amount of communications equipment ashore. If that equipment had been concentrated in a ship moored in Aden harbour, when we moved from Aden, we would move the ship and not leave very expensive buildings—I hope that we will not leave any equipment—such as have littered the Middle East in the years since the war.
To be fair, the Government have provided some form of headquarters ship in the two new assault ships "Fearless" and "Intrepid", with communications equipment and facilities for operating a brigade group in an assault landing. But I ask for research and development into a larger form of ship which could be adopted as a maritime headquarters or serve as a joint headquarters for the three Services wherever needed throughout the world. I wonder whether any thought has been given to the development of such a ship, which the Americans have found so successful that they are building others.
I should like to discuss briefly the question of hovercraft. This is a British invention, which is an extraordinary advance on any previous concept. These craft are now being developed under


licence in most other countries in the world. What I am anxious to discuss is the application of these craft in the three Services.
I believe that the Army has the first operational hovercraft squadron in the world and that they are also being used by the R.A.F. The other day we saw pictures of them being used by American forces in Vietnam. What about our Navy? These are perhaps more ships than anything else, and it seems, when one sees a picture of a Cunard cruising liner with a hovercraft on board to take passengers ashore, that we should have done more to develop these very important craft for the Royal Navy.
I know that there has been a certain amount of experimenting in using the hovercraft for replacing the L.C.A. in the amphibious assault, but have we given much consideration to the development of the hovercraft as an anti-submarine vessel? The Minister will know that the modern nuclear submarine's underwater speed could be considerably in excess of that of many of the hunting vessels. Many of our frigates are slower on the surface than the nuclear submarine under the surface. The hovercraft, which is far faster in reasonable weather conditions than surface ships, might have a very important part to play in anti-submarine warfare.
From hovercraft, I turn to hydrofoils, which rise on a couple of stilts when they are going very fast. The Americans are putting in a lot of research and development on these vessels, particularly for anti-submarine purposes, because they also are considerably faster than any other form of surface vessel. They suffer, as do hovercraft to a lesser extent, in bad sea conditions. Can the Minister say what is being done to develop hydrofoils in the Royal Navy, and whether he feels that this craft could be of use as the anti-submarine vessel of the future?
I want to deal with submarines and, in particular, with the hulls of these vessels. I was glad to hear that the hon. Member for South Ayrshire (Mr. Emrys Hughes), both in the previous debate and a moment ago, on the Navy, praising the defence correspondent of The Times. I quite agree with him, I think that The Times defence correspondent writes some extremely useful and interesting articles.

They are certainly useful to the Opposition and Government back benchers, who do not have access to information

Mr. J. Enoch Powell: And to the Government.

Mr. Wall: I am sure that my right hon. Friend is correct.
On 11th March The Times defence correspondent wrote an article about the steel used by nuclear submarines. What he said was that the British steel used in the first nuclear-powered submarine had proved not very effective, and that hairline cracks had developed which matter we have discussed in the House on a number of occasions.
He said that to get over this problem we had to buy American high quality steel and that this had, presumably, gone into the vessels after "Dreadnought", the "Valiant" class and the four Polaris submarines. He said, and I hope that it is true:
Successful experiments have been carried out in Britain by the Consett Iron Company to produce the special steel required for building nuclear submarines. British steel will be installed in the seventh hunter-killer submarine to be ordered later this year.
I hope that the Minister can confirm this. What I would also like to know is what happens in the earlier submarines? Is he satisfied that the problem of these hairline cracks—I know that they are no danger to the crew—can be overcome, because, again, The Times defence correspondent says:
The cracks occur in all the submarines, but do not prevent them from going to sea. Should the cracks occur in an unexpectedly high desensity, an excessive amount of welding work would be required between cruises.
I am not suggesting that this is impairing the operational efficiency of any of our submarines, but it would be a little unfortunate if a lot of time had to be spent in welding over cracks which are invisible to the normal eye. Perhaps the Minister can clear up this point.

The Minister of Defence for Equipment (Mr. Roy Mason): I can clear that up now, because I answered a supplementary question which the hon. Gentleman posed to me a few days ago, saying that the problem of the steel had been solved.

Mr. Wall: I am very grateful for that assurance.
I want now to deal with nuclear propulsion. In the Statement on the Defence Estimates, Chapter 6, paragraph 25, we find, under sub-paragraph (a):
The nuclear-propulsion programme, including work on a new submarine reactor and investigations into the application of nuclear propulsion to surface warships
will be continued. I am delighted to hear that, because I remember that the hon. Gentleman, when he was on these benches, used to clamour for a surface nuclear-propelled merchant or naval ship, as I did when I was on the back benches on the Government side.

Mr. Mason: We are doing something about it.

Mr. Wall: I am glad to hear that, and I hope that the Minister will be able to tell us later what has actually been achieved.
I notice that he had a good "write-up" in the Daily Express on a recent speech that he made when he visited the Rolls-Royce plant in Derby a few days ago. The headline says:
Navy may go atomic, says Defence Chief
I hope that this is true. The report says, quoting the Minister of State:
We have considered the possible application of atomic power units like those designed here for surface propulsion and it is a possibility that the Navy could go atomic.
That would be a very great advantage. Atomic propulsion is obviously of more value to the Navy rather than to the mercantile marine, because in the mercantile marine one has to consider the economic problem. In the Navy, long-distance cruising, a saving of fuel tankers and on oil bases throughout the world are factors to be taken into consideration.
The Minister also got a good write-up in The Times of today, which said:
During today's Commons debate on research and development, Mr. Mason, the Minister of Defence (Equipment), is expected to give details of the Ministry's latest thinking on such vessels"—
that is, nuclear surface warships. I hope that my appetite having been whetted in this way, the Minister will have a long statement to make. We feel that many other countries are getting ahead of Britain in the development of a nuclear reactor for surface vessels which we, in some ways, pioneered.
We have always been one of the premier maritime countries and now there

are nuclear-powered ships in the United States Navy and there is the "Savannah" in the U.S. Merchant Navy. The U.S.S.R. Navy has such a vessel, and I understand that Japan, Germany, Italy and possibly Sweden are contemplating building surface ships with nuclear reactors. I hope that the Minister will decide that the Navy will set the pace in this country, and go ahead with a nuclear-propelled surface ship, perhaps a supply ship, or perhaps even a "Healey Carrier", and that this will be something that the Merchant Navy will be able to follow, having gained experience from the Royal Navy.
I now turn to weapon systems and, first, Sea Slug. This is an excellent weapon, rather large, which is possibly why it has not been taken up by other navies. Is any more development work being done on this weapon? It seems that the American Tartar, which is not as good a weapon but is smaller, has had a much larger order from foreign countries. Can the Minister say whether the Mark II Sea Slug, which will be going into the "Fife" and "Glamorgan", the last of the guided missile destroyers of the "Devonshire" class has a bombardment capability? I know that it has no surface-to-surface capability.
I come now to Sea Cat, a short-range surface-to-air weapon. This has been sold abroad to many foreign navies. Is it to be developed further, or is the new surface-to-air weapon referred to in paragraph 18(g) on page 47 of the Statement on the Estimates which is now in the experimental stage to replace Sea Cat completely? In other words, is the life of Sea Cat confined to those vessels in which it is now mounted?
I turn to another question which we discussed in the debate on Vote A, and that is Sea Dart, a new surface-to-air longer range weapon which is to go into the Type 82 destroyers. The hull of these destroyers is 5,000 tons. Is it necessary to have such a big hull to accommodate this weapon, with all its guidance requirements, or are there other reasons for making the Type 82 destroyers so large? I repeat that the Germans appear to be mounting the American Tartar in a 1,000 ton hull, which obviously will be considerably cheaper.
We read in the newspapers that the development costs of Sea Dart are about


£40 million. I was told in an answer to a Question the other day that Sea Dart is not yet afloat. We hope that it has a good future. Does it have a bombardment capability? I take it that it cannot be used as a surface-to-surface weapon?
That brings me to the hardy annual—the surface-to-surface missile. We this side of the House think that this is a very important matter. It was referred to twice in last year's Statement. It is not referred to at all in this year's Statement. I mentioned it in column 654 of the OFFICIAL REPORT of the debate on Vote A and pointed out that not only the Soviet Navy but smaller navies, such as that of the U.A.R., or Indonesia, have fast patrol boats armed with two or four guided missiles which have a much greater range than the guns mounted in our larger ships. Unless we have a surface-to-surface missile we could not deal with those vessels once the carrier and fixed-wing aircraft were phased out.
If the Government adhere to what we believe to be a thoroughly mistaken policy and phase out the carrier in the mid-1970s they must have a new surface-to-surface missile available and operational at that time. Otherwise, there will be very little defence against these midget vessels and surface-to-surface missiles mounted on larger vessels in the navies of foreign powers.
I wish now to mention briefly underwater weapons, because the question of research and development on underwater vessels falls under these Votes. I deal, first, with torpedoes. "Dreadnought" was armed with torpedoes similar to those first introduced in 1934. The Under-Secretary of State, when he wound up the last debate, talked in column 668 about the development of two new anti-submarine torpedoes—one to be fired from submarines and the other to be dropped from helicopters. Will those new torpedoes be ready to go into the last "Valiant" class vessels as they become operational or will they only go into the new type of hunter-killer submarine to be ordered towards the end of this year?
I refer, secondly, to mines, which are a defensive weapon. I do not know whether they are considered to be com-

pletely old-fashioned, but certainly they caused us to devote an enormous proportion of our effort to anti-mine operations in the last war. They are cheap and a useful form of weapon for coastal defence and sometimes for inhibiting enemy movement in narrow channels. Are we still developing acoustic mines and other forms of pressure mines, or is the mine regarded as an obsolete weapon?
I come now to the question of radio equipment. That is if one can call variable depth sonar "radio equipment". The "Leander" class frigates are probably the best class of ship we have designed. Certainly, they are the finest looking ships we have seen for many years. They have a large ramp in the stern for their variable depth sonar. At first, Canadian equipment was installed which I believe was not very satisfactory. I believe that the Government decided to experiment with either a new British sonar or American sonar. Could the Minister tell us the results of those experiments. Are we producing our own form of variable depth sonar? If so, is it satisfactory and is it in operation?
Turning to the question of antisubmarine devices, as I have said, the nuclear submarine moves faster than most surface vessels. I therefore hope that we shall hear more about hovercraft and perhaps about maritime aircraft. I cannot say much about that matter in this debate as I should be out of order. It is immensely important, however, to ensure that the maritime Comet being designed for the R.A.F. fits in in all respects with the anti-submarine vessels of the Fleet.
Do the computers in the aircraft and in the anti-submarine vessel correspond? I have heard rumours that there has been a lack of co-operation between the two Services in this matter. I hope that the Minister, whose direct responsibility this is, will be able to assure me that I am wrong.
I have touched on a number—perhaps too large a number—of points affecting the hulls and equipment of Her Majesty's ships. Nearly all of them were made during the debate on Vote A and, therefore, I think that the Minister has had sufficient warning to phrase his reply.
To sum up, new ships and weapons take seven years to develop. It is obvious, therefore, that the question of research and development on them must be


included in the Vote which we are considering. Can the Minister say whether any research and development is being carried out on some cheaper form of carrier—say, the "Healey carrier"? Are the Government considering headquarters ships? What is being done about nuclear propulsion for surface vessels? Are we producing fast anti-submarine vessels—perhaps hydrofoils or hovercraft? Would the Minister say exactly what will happen about the development of surface-to-surface weapons which must be in service and operational by the mid-1970s if the carrier is to be phased out? Assurances that these matters are under active consideration will do much to raise morale in the senior Service and will encourage the Opposition to approve these Estimates.

Mr. Cyril Bence: I know that I cannot discuss appropriations in aid in detail, but I should like to relate what I have to say to appropriations in aid. I note under subhead C the amount of £334,300 for the production of charts, the repair of instruments and miscellaneous expenses. In subhead B there appears the sum of £24 million for research and development. The Department responsible for hydrography and the production of charts is successful in marketing on behalf of Her Majesty's Stationery Office charts and hydrographic publications through agents to merchant ships and the general public. It earns through its marketing department £526,000 as against an expenditure of £334,000. This is a very useful operation.
In the development of hulls and machinery and navigational equipment it spends £24 million but it appropriates nothing from anybody. The Navy is spending £24 million on ships, hulls and machinery, weapons systems, radio and navigational equipment, scientific research and technical services and naval medical research. Cannot it get someone to buy some of the fall-out from all this research and development?
When I read the Note at the back of this Vote, I am amazed that we can sell charts, but apparently we cannot recoup anything from this vast expenditure on research and development.

Rear-Admiral Morgan Giles: Is the hon. Gentleman not aware that the South

Africans would be happy to buy these things?

Mr. Bence: I do not suggest that the Royal Navy should sell its ships, because there is no object in building warships and then selling them to other people. The object of building warships is to defend one's own country, not to sell them to others for them to defend theirs.

Mr. Ogden: Is my hon. Friend not aware that, for a number of years, we have supplied naval vessels to our friends in the Commonwealth, at least?

Mr. Bence: South Africa is not in the Commonwealth.

Mr. Ogden: I agree, but the point which I made is that there is a market among our friends, principally our friends in the Commonwealth.

Mr. Bence: Yes, and I have no objection to British yards producing ships for the defence of the Commonwealth. However, I think that the hon. and gallant Member for Winchester (Rear-Admiral Morgan Giles) was referring to South Africa.

Mr. Wall: The hon. Gentleman will be aware, I am sure, that the Government have appointed an important, highly-paid civil servant specifically to sell weapons, including warships, to other Powers.

Mr. Bence: The present Government have appointed a Minister whose responsibility it is to see if, in our research and development of weapons systems, we could not develop systems which might be shared with Commonwealth countries by the adoption of common standards. That is reasonable, but it is not reasonable to employ scientists and technicians in Admiralty yards to do splendid research and development work if we cannot dispose commercially of any of the results, especially developments in navigational systems.
Surely the Admiralty should be able to dispose of some of these developments to merchant shipowners. After all, it sells them charts. Why cannot it sell some of these navigational systems? What happens to them, otherwise? Are they handed over to British or foreign shipowners for nothing? They have to pay for the charts. Why should we not


get some appropriation from selling the results of all this £24,728,000 worth of research and development?
I have always believed that from military research and development there is a small fall-out for civil industry. For example, from the aircraft industry we get the development of new alloys, and that has always been so. But it is increasingly unfortunate in a modern civilisation, when we have sophisticated weapons with tremendous destructive power, that we have a Department of State concerned with research and development which does not seem to be co-ordinated with research and development in all sorts of private institutions.
I should have thought that a lot of the items included in this Vote could be moved over to one of the Votes of the Ministry of Technology. We heard in the debate on the Air Estimates that some of the costs of the AFVG, in co-operation with the French, did not figure in those Estimates but came under the Ministry of Technology. Why should not some of this research and development come under that Ministry? Why should not that Ministry co-operate with different private industries in this sort of research? Why should it be purely the responsibility of the Admiralty and be confined to the Navy Estimates?
Weapons systems peculiar to naval warfare must come within the Navy Estimates. I understand that. However, I should have thought that medical re-search, and research on navigation, hulls and machinery could come under some universal research department dealing with all aspects of marine engineering, mechanical engineering and electrical engineering. Again, when we consider navigational aids, surely navigational aids in ships have something in common with those used in aircraft.
I am shocked to see such a large slice of the taxpayers' money being spent on research and development in this period of economic difficulty when we are all tightening our belts, and that all that we can get back from the people who will benefit from it is £536,000 for the sale of maps and charts. I should have thought that out of all this research, the ship owners and shipbuilders of the United Kingdom receive considerable benefit. I cannot see why there should

not be in the appropriations in aid something from them by way of a contribution towards that research.

8.26 p.m.

Mr. Hugh Fraser: I shall confine my remarks to the Subhead which deals with scientific research and technical services, which totals some £5 million. I disagree with the hon. Member for Dunbartonshire, East (Mr. Bence). One of the troubles is that there is not a sufficiency of concentration of research at the Navy level, and that there has been a dissipation of research elsewhere.
The hon. Gentleman spoke about industrial application, and I agree that there is a great chance for that, but it must flow eventually from the type of deep research which is carried out into Navy matters.
I gather from the Department that some of the £5 million mentioned in this Vote is devoted to what I would call deep research, by which I mean oceanographic research of a profound nature which clearly is a matter of great importance and an area in which we seem to be lagging behind some other countries.
When one looks at the amount of money spent by other countries, one is presented with an alarming picture of the deep and profound research in oceanographic matters which is being conducted. The United States of America are spending more than £100 million a year on profound research into sea use and the future of warfare at sea. My hon. Friend the Member for Haltemprice (Mr. Wall) referred to the problems of the deep travelling submarine, and those problems are by no means overcome.
We have heard of the problems of the Russian submarine fleet, but if one considers Russia's investment in profound oceanographic research, one arrives at an even more startling position. Russia has no less than seven large laboratory ships at sea. In addition, there are countless trawlers which, apart from their honest work of trawling, undoubtedly also carry out considerable research for the Russian Government. If one looks at what is happening with Japanese investment, we see that here again there is a bigger investment than we are making. If one looks at deep oceanographic investment by a country like Canada, one finds that it is something like £20 million a year.


If one looks at oceanographic investment by the French Government, one finds that it is running at a much greater level than is ours today.
I believe that this flows from two profound mistakes which are being made. The first is the organisation of oceanography, and the second is that there has not been sufficient thought given to this subject and a sufficient programme prepared.
Turning for a moment to the question of organisation, you may remember, Mr. Deputy Speaker, that when the hon. Member for Woolwich, East (Mr. Mayhew) was the Minister of Defence for the Royal Navy, he came to the Box on 15th March, 1965, and said that there had been this great changeover, and that from 1st April, April Fools' Day, the Navy was going to lose the "Discovery", and that the Oceanographic Council was going to pass into the control of this remarkable body called the National Environment Research Council.
The National Environment Research Council is a very odd body indeed. I see that the hon. Gentleman is laughing, and with cause, because the National Environment Research Council, with regard to oceanography, is responsible to the Secretary of State for Education and Science, but the actual payment for oceanography is to be made by the Ministry of Technology. This is really a most fantastic way to try to spearhead an important programme, and the Government stand condemned in the most extraordinary fashion for having this set-up in which the Navy was said to have an important interest.
I hope that the Minister will look at this most carefully. Here is the Soviet Union, with seven deep research vessels. Here is the United States, with a programme running over 10 years at a cost of £1,000 million. Here is the United States, building three—I am not a naval man—what they call deep-diving craft, one of which will work at the 5,000 fathom level, one of which will work at the 8,000 or 10,000 fathom level, and one of which will operate in the Mindinao Trench, which is about 35,000 ft., which, as a landlubber, is how I express these things.
But what do we have? We have this great step forward, where we have a Department which is paid for by another

Department, which is responsible to a Minister who is largely concerned with fighting the students at the L.S.E. No wonder people say that the naval glory of this country is over.
We really want to look at this most seriously. The people of this globe, as hon. Members opposite know, occupy 25 per cent. of the earth's crust, and 75 per cent. of it is covered by water. This is a new area into which we should be going. We must conduct research on this area and get out of it the resources which are there. This does not mean just using plankton. It means that we will have to turn seawater into water which can be used to refresh the desert.
This year there is a conference in the United States on desalination, something in which this country and our engineers from the naval yards are as expert as any-one in the world. Who is setting this up? It is the President of the United States. Yet we have here a Minister who is not responsible for the Department for which he should be responsible.
It is notable to see what is happening regarding this question of desalination. In Glasgow there are probably the most skilled engineers, and in our form of atomic power, we probably have the most suitable machinery, but where are the contracts going? They are going to Kuwait and Mexico. They are not coming here. The responsibility lies with the Government, who have not seen fit, despite all this great talk of technological advance, to switch a beam of light onto the problem which faces us.
I suggest that the best body and the best person to switch on the beam of light to be a positive laser in the encircling gloom is the Navy Department. It has a great tradition of naval inspiration It has the tradition of Captain Cook of the eighteenth century, and moving into the nineteenth century, there is Biscoe, the adventurer in the 'forties, and then we move through to the whole history of Polar exporation by this country, the technical advances which were made here before the war, the technical advances which even now are being made, and when I was Air Minister I saw the American advances in sonar equipment, and we were as good as they were. In addition, we have the question of giving the people and the scientists some sort of inspiration.
Sea use is going to be one of the greatest problems during the next hundred years or so. We are a maritime people. We ought to make full use of this. It will be an inspiration to our scientists and young people if we can make full use of what is there. I know that in the discipline of mass technologies we always get an advantage by the problem of major projects. We get microminiaturisation and all these other things, and what is called the fall-out. But we get something far more important here if we use the sea and the oceans and the problems which lie therein.
If we could be certain that we were able to break through these changes, which we are not certain of today, we would be in a far better stamp. But, above all, there is a discipline which can be imposed, that of a growing shortage of food, a growing shortage of minerals, and a growing shortage of water. This is why I say that the Government have a great chance. They have failed so far to make this into a major and dynamic science using the brains, the industry, and the power of our people.

8.37 p.m.

Mr. Emrys Hughes: The right hon. Member for Stafford and Stone (Mr. Hugh Fraser) brought in a wave of eloquence which had hitherto been missing from the debate. Unfortunately, we are dealing with statistics, and I should like an explanation of why the money in Vote 4 has been increased. This year we are spending £4 million more than last year. The number of scientists employed by this Department is increasing, and we are to spend £34,655,000 on scientific services purely for the Navy. The Ministry of Technology and all the other Ministries are spending their money, too. The result is that we are using a large percentage of our scientific brains on what is called defence work. I think that this is likely to increase. I think that the amount in Vote 4 will increase in the future, because if we employ more scientists, they will want to spend more money.
We are told in Subhead B that they are studying weapon systems. I wonder which ones. If they are studying the Russian capacity for destroying submarines they will have discovered that

for the last nuclear test before the Test Ban Treaty came into being the Russians had a megaton bomb which could destroy everything within a radius of 200 miles of the area in which it fell. As the Economist pointed out at the time, this bomb could destroy the hull of a submarine in a radius of 200 miles of the area in which it fell.
I wonder how far they are studying the United States weapons systems, as The Times correspondent has been doing. Those scientists studying the American weapons systems and the Polaris submarine have discovered that the system operating when we ordered the submarines is now almost obsolete, because the Russian defences can prevent the launching of missiles from that type.
Thus, the Americans are now changing from the Polaris to the Poseidon missile. The Times correspondent tells us that only eight of the American Polaris submarines now carry the old weapon. To enable the Polaris system to penetrate the Russian defences, the scientists must now advocate the enormously expensive Poseidon. Therefore, I view these researches with some apprehension. If, as The Times correspondent says, they produce evidence for the Government that these weapons are obsolete, we shall presumably have to take their advice and adapt our submarines to the new missile.
I also view with apprehension the fact that the number of scientists is going up like the cost of the new weapon, so the Department's expenditure will also rise. This applies not only to this Department, because it is a key Department. These scientists do not think in terms of pounds, shillings and pence, but of weapons which are likely to be effective in the nuclear age. So this Vote is going up, when we should be reducing our expenditure.
What else are the scientists doing? I am glad of my hon. Friend's assurance that the steel problem is solved, though I am not so sure about the terms. The scientists have presumably examined these submarines and discovered that the steel can withstand the stress of modern warfare, although the specification is different in the American one. I hope that we will not in a short time have to spend more money on the Polaris submarines because of this research.
I wonder how many of these scientists are employed in the Polaris school at


Gareloch. They must be, because of the extraordinary expense of the school. Its cost of £10 million shows that an enormous amount of research must be going on. The expenditure on this school is envied by every scientific institution and technical school in the West of Scotland. They say, "Why should the nation be spending £10 million on one technical school when we cannot get the money in Scotland to build ordinary technological institutes and colleges of research"?
In the first debate on the Navy Estimates which I heard in this House, Mr. Winston Churchill, as he then was, viewed with great alarm the growth in the number of people who were planning and studying to make a stronger Royal Navy—and at the same time providing jobs for themselves. At that time Mr. Churchill was scathing on this issue. I shudder to think what he would say at the enormous growth that is taking place in the Navy Estimates each year. I recall how he attacked the then Labour Government in 1948. That was 20 years ago, and today another Labour Government are spending far too much on the Navy.
Why is the sum for research and development increasing at this rate and when do the Government propose to reduce it? We should not go on diverting our scientific brains away from studying matters which could modernise British industry. A large portion of the sum involved in Vote 4 is being misdirected and is not being spent on scientific research for the benefit of the nation as a whole.

8.47 p.m.

Sir Harry Legge-Bourke: I will not comment on the remarks of the hon. Member for South Ayrshire (Mr. Emrys Hughes) because those of us who have been in the House for the last 20 years recognise his speech each year. He always adopts the same theme and can be relied upon to follow a pacifist line. I am sure that he speaks with great conviction, but I wish to concentrate my remarks on discussing what is happening to the money that is being spent under this Vote.
I apologise to hon. and gallant Members who served in the Royal Navy and who may be wondering why I am intervening in this debate. I intervene

because of my interest in science and technology, and particularly because of a statement made by the Minister of Defence for Equipment in a speech on the subject of marine nuclear propulsion. I have a report of his speech with me. My hon. Friend the Member for Haltemprice (Mr. Wall) referred to the Minister's remarks of 13th March last in Derby, when the hon. Gentleman said:
We could now build an atomic-powered ship but cannot yet say of what size or class or of what cost it would have to be".
The date on which the hon. Gentleman made that speech is important because it so happens that it was several days after the new Select Committee on Science and Technology—which is meeting in public and that is why I can refer to its proceedings—had had an opportunity of cross-examining Sir William Penny, head of the Atomic Energy Authority, on this matter.
I am appalled at the inconsistency between what Sir William told that Committee upstairs and what the Minister said in Derby. According to the report I have, Sir William made it clear that the outcome of the Padmore Committee's consideration of this matter two years ago was an opinion which Sir William still holds today, namely, that the time has not yet arrived when we should commit ourselves to a programme involving a nuclear-propelled surface ship. Sir William emphasised that the most efficient union for surface propulsion was an oil-burning unit. When I asked him whether he thought the time had come to resuscitate the Padmore Committee and go into the matter all over again, he said that we should not—certainly for several years. It seems a very grave thing that the Ministry for Defence should not be in the closest possible communication with the Atomic Energy Authority before any Defence Minister makes speeches on nuclear marine propulsion.
I want tonight to give the Minister for Defence for Equipment an opportunity of clarifying this matter. It is a subject of very considerable concern. I find it all the more extraordinary in the light of what Sir William Penney had to say, and of what is said in paragraph 25a of the Defence White Paper, which refers to:
The nuclear-propulsion programme, including work on a new submarine reactor and investigations into the application of nuclear-propulsion to surface warships.


Are we to understand that this paragraph was included in the White Paper without any consultation with the Atomic Energy Authority? If so, it certainly seems utterly wrong. In the United States, the Atomic Energy Commission has a very special relationship with the United States Navy—

Mr. Mason: Perhaps I may intervene here, as there is no point in getting hot and bothered about something if there is a misunderstanding, and it looks as if there is a misunderstanding of the position here. Sir William Penney was talking of merchant ship nuclear propulsion, whereas I was talking specifically about nuclear marine propulsion for naval vessels only.

Sir H. Legge-Bourke: We now see a distinction being made in what Sir William Penney said. Are we to understand that if nuclear surface propulsion is considered to be an uneconomic and silly thing at present for the mercantile marine, for example, it is advisable to provide it for the Royal Navy? I should have thought that one experience which we might gain from is that of the United States atomic-powered ship the "Savannah". I understand that that vessel has been a dead loss, and there is no prospect of it being repeated as a type of nuclear-propelled surface ship.
What sort of ship is the right hon. Gentleman proposing for the Royal Navy that is to be powered by nuclear energy—

Mr. Mayhew: The hon. Gentleman must recognise the enormous difference between the naval vessel and the merchant vessel from the point of view of nuclear propulsion. For naval vessels, nuclear propulsion provides range, freedom from refuelling. The naval vessel is so much more expensive—and precious even—than the merchant vessel that the equation does not begin to exist.

Sir H. Legge-Bourke: I am very grateful to the former Minister of Defence for the Royal Navy for intervening, but I am asking the present Minister of Defence for Equipment. I hope that we shall get from him even more up-to-date information than that with which we have just been provided Having sailed

in both at various times, I am fairly clear about the distinction between a ship of the Royal Navy and a ship of the Mercantile Marine. All I would say is that if we are so desperately short of money for carrying out a defence policy which renders the country as safe as we can make it, we must be very careful before we start to embark on a form of propulsion that is far more expensive and not necessarily very much more effective than oil-burning vessels.
I am inclined to feel that it is extraordinary that, when Sir Francis Chichester is trying to sail through the "Roaring Forties" around Cape Horn, when our wonderful new nuclear fleet submarine the "Valiant" is making what is almost a record underwater voyage, and when we are co-operating with the French in producing a supersonic airliner, we should still be thinking of yet another way of propelling ourselves across the ocean. I feel that this is not perhaps the moment, in the light of the stringency we are always being reminded about by the Government, to embark on this sort of experiment when other things are much more important to meet at an early date. This is what concerns me. There may be surface nuclear propulsion in the end, but I am inclined to think that it is not very likely that what is found to be unwise for the Mercantile Marine will be wise for the Royal Navy, especially when we come to the economics of it.
My hon. Friend the Member for Haltemprice has mentioned the hovercraft. I have been down to Hythe, near Southampton, to talk with the N.R.D.C. people there. I believe that this is the most tremendously important development. I find it extraordinary that the Royal Navy should be the one Service among the three which is not apparently fully committed to this type of conveyance on the surface. With the Defence Estimates, it is becoming more and more difficult to unravel and discover what has been spent on any one project. For example, the Army is spending £1,100,000 on ships this year over and above what is being spent under the Navy Estimates.
I am inclined to feel that, soon, we must have the Estimates presented in a slightly different form so that we can be shown some of these new projects, such as marine nuclear propulsion and


hovercraft, each coming under one heading for all three Services. We could then see what we were spending on these individual developments. At it is, we have to try and extract little bits of information from different Votes in order to assess what is being spent on one project.
A certain amount has been said about fal-out of know-how—or "spin-off" as the United States calls it—which comes from what the Services spend on research and development. I agree that it is very important that civil industry should be given as much opportunity as possible to take advantage of the technology which does not have to be covered by strict security rules. But I have never thought that we should embark on a particular defence project with a view to getting civilian "fall-out". Certainly we should take full advantage in civilian industry where there is real value to be gained, but let us not start defence projects in order to get civil fall-out. That would be a preposterous exercise.
With the hovercraft, we are in danger of overdiversifying activity in research and development. The N.R.D.C. was originally the Government-sponsored body which took up Mr. Cockrell's great invention. He is very dissatisfied about the way it is now going and feels that its application commercially has been kept too much under Government auspices.
The N.R.D.C. has done a splendid job on the hovercraft along with Hovercraft Ltd. Indeed, even the Ministry of Housing and Local Government is coming into the business in refusing to decide where the English terminal should be for cross-Channel traffic designed to be conducted, I understand, by Hover-Lloyd, of Sweden. All these projects are coming up and we have civil, military, naval and air force activities in their development. They are all doing a little bit and we do not know what it is all costing. Perhaps there is duplication where there should not be.
I should like to see hovercraft development for the Service Departments coordinated into one project. If we diversify the development of the hovercraft throughout the three Services, we shall probably waste public money by duplication not only of Service activity but also of N.R.D.C. activity. At the same time, those developing the hovercraft for civil

activity have a better chance of financing their research and development from the money market.
Let us at least get a sound policy on this matter. I should have thought that the Royal Navy had a prior claim on such an exercise, although I know that there is an aviation aspect to it. N.R.D.C. should be able to provide the unifying forces for the Government and advise the Service Departments as to how best to go about it. Obviously the Service Departments will require experience in usage. The Army deserves credit for the way it is going about that. I am concerned here with the research and development aspect, which is what this Vote is about. We are in great danger of not getting full value for the money we are spending.

Mr. Geoffrey Wilson: British Railways are also experimenting with hovercraft.

Sir H. Legge-Bourke: I am a little worried about that. British Railways have a vested interest in stultifying to as great an extent as they can the hovertrain project, but that does not come under this Vote.
We always ought to be prepared to spend on the Royal Navy before we spend on any of the other Services. I say that as a soldier. I have always held this view. We are a maritime nation. Our position on the globe demands this. Therefore, I like to see the Royal Navy getting value for money. I am not sure that it is getting it. As long as there exists the sort of confusion which the Minister of Defence for Equipment perpetrated the other day, there will be great uncertainty in our minds as to whether we are getting value for money. I hope that this evening the hon. Gentleman will clear the matter up.

9.2 p.m.

Mr. Ogden: The hon. Member for Isle of Ely (Sir H. Legge-Bourke) had a long and distinguished Army career. Though he was right to apologise to the House for intervening on naval matters, he redeemed that at the end of his speech when he said that the Royal Navy should have priority over the other Services. The hon. Gentleman is allowed one bite. He has had it. We shall


watch the hon. Gentleman if he is contemplating making a take-over bid in accountancy. Once the accounts of the three Services were brought under one heading, there would be the danger that the whole of the three Services might be brought under one heading.
I want to refer particularly, first, to Subhead B—
(1) Ships, hulls and machinery; (2) Weapon systems, radio and navigational equipment".
Can my hon. Friend the Minister of Defence for Equipment give an assurance that the Board of Trade, the Ministry of Defence and the Ministry of Technology are in continual consultation? Is there an exchange of information between the Service Departments, the civil Departments of the Government and civilian organisations outside the Government so that there is a continual exchange of information?
Some research is controlled from old Admiralty buildings. These have been cleaned up recently, but I am sure that if my hon. Friend the Minister of Defence were to look at the inside of these old Admiralty buildings he would agree that only one description can be applied to them—that is, tatty. It is a shame and a disgrace that the administration of the Navy should be carried on from such completely inadequate buildings. If they were civilian factories or offices, they would have been closed down long ago. Such action would result in a saving in the long term. I hope that an indication can be given of what is likely to happen to these old buildings.
I ask the Opposition to think again about some of the ideas they are advancing in relation to the Healey carrier idea. The phrase "Healey carrier" is not the best description. A ship, as the hon. Member for the Isle of Ely knows, is definitely a lady. My right hon. Friend the Secretary of State for Defence is definitely a gentleman.
I ask the Opposition to think again about the idea, which seems attractive, that we can get the type of ship we want to fulfil the purpose we want fulfilled at half the cost, with a utility hull and getting two for the price of one. I appreciate the arguments which have been advanced about equipment and a

cheaper hull, but the Opposition should give us more information about what their thoughts are. What effective range do they envisage for such a ship? How long would she stay at sea? Where would its bases be? What sort of operational zone would it have? What sort of zones would it cover? How many will be needed to do the kind of job which the four, five or six full carriers would do? We need more information in order to consider the point which the Opposition are putting forward.
The Opposition have made a great point of nuclear propulsion for surface ships. The Russians have their nuclear-powered ice breaker, the first to conic into service, I think. Then the "Savannah" came along, only to be laid up 18 months or two years ago. There were great hopes and high expectations from these developments at one time. I suggest to the Minister that in this field it might well be better to be a little late with the best than to be first in. We should be prepared to take advantage of the research done by other countries.
Have we any information about the propulsion units of either the "Savannah" or the Russian ship? There have been great changes in our nuclear power stations at home. How much of the knowledge gained here has rubbed off? I think I see the point in the Minister's mind in his approach to this matter. We have had roughly 20 years of discussion, research and information into what kind of unit there should be. I am sure that most hon. Member with naval experience of one kind and another will agree that a nuclear-powered merchant ship is a very different proposition from a nuclear-powered surface ship for the Royal Navy, but it is time that we got away from the idea that we can have nuclear power only in submarines and got back to the idea of nuclear-powered surface ships.
If the Minister will give us an indication of his thoughts about the concept, "Let's go atomic"—a dangerous phrase—the House will be grateful.

9.2 p.m.

Mr. F. A. Burden: I am much obliged to the Minister for giving me three minutes. My constituency is very much concerned about the future of research and development. It is essential


that the Royal Navy be allowed to continue to do its own research and development. I am sure that the Navy would be horrified at some of the suggestions made regarding the future.
The Royal Naval Dockyard at Chatham, in my constituency, has just been assigned the task of being one of the depots for the repair of nuclear submarines. Constant research is going on there in a great number of directions, into weapon development, into hull construction and welding, and into the whole gamut of submarine construction and repair.
When I hear hon. Members complaining about the money which is spent on research, I am worried about the effect there will be if the men in the yards who are engaged on research are not paid adequately. There are many firms outside which are only too anxious to get hold of these men and engage them. I hope that the Government will always keep in mind the need to ensure that the highly skilled men in the naval dockyards who are necessary for the doing of research and development and the ordinary routine work are assured of incomes which encourage them to stay in the dockyards. It is no good having nuclear submarines and it is no good talking about research and development unless the men in the naval dockyards are paid adequately so that they remain there and are not encouraged to leave by outside interests.

9.4 p.m.

The Minister of Defence for Equipment (Mr. Roy Mason): I am sorry that other hon. Members who are interested in the debate have been squeezed out because of the lack of time. I rise with some caution to make my in entry into defence affairs. Perhaps I should call it a reentry, because at one time, as the hon. Member for Haltemprice (Mr. Wall) knows, I used to take a keen interest in these matters. Since those days, there have been rapid changes. Weapon technology is changing so rapidly that, having re-entered the Ministry of Defence, or, rather, having taken a new interest in Ministry of Defence affairs, I find that I have to learn afresh.
I cannot at this stage pretend to answer every question which has been put during the debate. It would be foolish of me

to try, and I do not suppose that the House would expect me to do so after having been in my job for only about two months.
My new job at the Ministry of Defence, under my right hon. Friend the Secretary of State for Defence, includes responsibilities for research and development for all three Services. I am grateful to my hon. Friend the Under-Secretary for Defence for the Royal Navy for giving me the opportunity of dealing with this research and development Vote.
During the past two months I have been making myself acquainted with this work, and have visited a number of establishments—the Admiralty Research Laboratory, at Teddington, the Services Electronic Research Laboratory, at Baldock, the Admiralty Surface Weapons Establishment, at Portsdown, the Royal Aircraft Establishment, at Farnborough, the Royal Research Establishment, at Malvern, and Rolls-Royce and Associates and the nuclear division at Derby who are working on the nuclear propulsion programme.
The hon. Member for Haltemprice, who opened this debate on behalf of the Opposition, spoke particularly about naval weapons systems and hulls and machinery. I am glad to be able to say something about them so early in my term of office. It will be agreed that much more information is now published about those matters than there used to be, and that that is a good thing. The right hon. Member for Wolverhampton, South-West (Mr. Powell) made that point earlier in the debate. He wanted to see the information expanded in various forms.
In the Statement on the Defence Estimates, 1964, there was a single paragraph describing work in progress in naval research and development establishments, in terms so broad as to be almost meaningless. In this year's White Paper there is a whole chapter on research and development giving details of expenditure and major projects. A great deal of information can be gleaned from that.
Research and development is in progress on weapon systems working in all the naval modes and without going into every aspect of air-to-air, air-to-surface systems and so on, I can say that on every aspect of requirement some basic research is being carried out. The hon.


Member for Haltemprice is perturbed by the omission of a surface-to-surface missile. I can assure him that research is being carried on in that, but it is difficult for us to make a positive announcement about it. First, it is dependent on how many weapons we may require and to what extent it may be too expensive for us to do alone, and we are thinking to what extent there can be a collaborative venture with other countries.
We are spending a good deal of money on hulls and propulsion, particularly on nuclear propulsion. My hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) questioned the increase in the Vote. There is an increase, partly because of S.E.T. and partly because of increased pay and prices but at least £3 million is because of increased research on nuclear propulsion techniques and weapon systems.

Mr. Burden: How does S.E.T. affect the Vote. Who must pay S.E.T. among those who might be engaged in this?

Mr. Mason: I think that it is because of the civil employees of the Navy. Consequently, all the Services must carry a percentage of S.E.T. in their Vote this year.
A number of hon. Members mentioned the future of nuclear propulsion—the hon. Members for Haltemprice, Isle of Ely (Sir H. Legge-Bourke), my hon. Friend the Member for Liverpool, West Derby (Mr. Ogden) and, indirectly, the hon. Member for Gillingham (Mr. Burden).
I am glad to see that some of the remarks I made last week when I went to Rolls-Royce, at Derby, have attracted attention. We now have a very big building programme of nuclear-powered submarines; the first two Polaris boats, "Resolution" and "Renown", have been launched, the first two Fleet submarines, "Dreadnought" and "Valiant", are in commission, "Warspite is nearly ready for acceptance, "Churchill" and two more are on order. We are looking ahead to submarines incorporating an improved reactor plant.
Rolls-Royce and Associates and Rolls-Royce, Nuclear Department, at Derby, design and procure the nuclear propulsion plants for us and manufacture the

nuclear cores. In all those activities they have very remarkable achievements to their credit already, although they are comparatively new in this business, including the completion and successful running of the nuclear propulsion plant at Dounreay as well as in submarines.
As for the future, they have succeeded in improving their designs to such an extent that the new power plant on which they are working is expected to have twice the life of the present plants in our submarines, with obvious benefit to submarine deployment. These developments make it quite sensible to look again at the possibilities of putting nuclear plants into surface warships. In such a short time this is a remarkable achievement which should be applauded. We got the nuclear know-how from the Americans in 1958 and in this short time we have developed a new nuclear core, core B, which can lengthen the life of submarines at sea between refits to double what it is. This means that we can think about putting it to service on surface vessels.
Here considerations of need and cost come in. We have to make sure that the future Fleet is going to need nuclear propelled surface ships before we can go far along the road of development of surface plant. This is something which will depend on the studies still going on and which my right hon. Friend has described. What was mentioned by the hon. Member for Haltemprice about the headquarters ship is also bound up with that study.
Another point about this particular programme, the Rolls-Royce and Associates programme producing this new core, which pleases me very much, is the good effect it is having on a wide field of related industry. About 40 firms are involved in the nuclear plant procurement programme which means that Rolls-Royce's world famous standards of quality assurance are spreading through these fields. This is one of many examples where the defence or research programme is proving a worthwhile investment for the British economy generally.

Mr. Burden: There is, of course, another area in which there has to be concern about safety. Will the hon. Gentleman say a word about how safety has also been improved with these new units?

Mr. Mason: I do not think that the hon. Member should be unduly concerned about this. The Americans have already nuclear surface naval vessels as well as many underwater nuclear-propelled vessels, we have four Polaris coming along and six hunter-killers. Our minds are already being conditioned to the fact that they are safe.
The hon. Member for Haltemprice asked a number of questions about hovercraft. We are, of course, interested in the application of hovercraft techniques, including application to larger vessels, and we are keeping in close touch with the Ministry of Technology, which is responsible for the techniques involved. Two hovercraft have been ordered. We are currently evaluating this material, and are considering a design study for a small hovership. I was interested when I went to A.R.L. to find that research was being carried out into the possibility of a hovership. There could be great potential there.
The Type 82 mentioned by the hon. Member for Haltemprice is a ship of the planned size because it incorporates not only Sea Dart but also Ikara, Broomstick and Ada equipment. We could have a smaller hull if there were Sea Dart and not Ikara. As for the aircraft carrier, I understand that for it to be really cost-effective it would have to be at least a 50,000-tonner and would cost £65 million or more. This would be too expensive. No current research and development expenditure is going on on such a hull.
The right hon. Member for Stafford and Stone (Mr. Hugh Fraser) has asked about the efforts we are putting into oceanography. He mentioned the American oceanography programme. I think that most hon. Members would accept that we cannot seriously claim to match this sort of standard although, of course, we benefit from the American programme in the exchange of information.
There is not much I can properly say on this Vote about British oceanography because, as hon. Members are aware, the National Institute of Oceanography is now the responsibility of the National Environmental Research Council and all that part of the national programme to which the Navy Vote used to contribute a large share is now borne entirely on

Civil Votes. However, we still have a very strong defence interest in oceanography for defence purposes which is covered by an Oceanographic Branch in the Hydrographic Department and by the recently reconstituted Oceanography Group at A.R.L., Teddington. These work in close contact with the National Institute of Oceanography. Overall the scale of effort in this field is growing, but it is limited by the national shortage of physical oceanographers. We are intending to keep up the pressure to find them.
My hon. Friend the Member for Dunbartonshire, East (Mr. Bence) and the hon. Member for Isle of Ely (Sir H. Legge-Bourke) mentioned the civil application of defence research. I am particularly keen on this. A great deal of work done in naval establishments could have valuable applications in the civil field. Bearing in mind especially the comments published yesterday about liaison between universities and Government research establishments, I would emphasise that naval research covers a very wide spectrum and time-scale from bright ideas which may have applications 20 or 30 years on to post design of equipment already in service. The trouble is that much of this work, as I say, could have very valuable applications in the civil field, but present arrangements for ensuring these are rather varied and not all of them are very effective.
At present, the machinery for spreading knowledge of naval R. & D. includes contractual arrangements like those for Co-ordinated Valve Development—C.V.D.; the National Research Development Corporation—N.R.C.D.; selling, lending or giving away particular information or devices; and various methods of linking R. & D. with industry. These methods vary a good deal in effectiveness, C.V.D., for example, involves 12 major firms with our R. & D. establishments; we benefit from the work done, so does industry, and Navy Votes profit in return for commercial rights to exploit new advances. In many items of the programme, the firms concerned make a special contribution, but other methods are less satisfactory and I am already satisfied that this is a subject for examination.
Let me give some actual examples of civil application of defence research:


one a success story, and the other the reverse. The success story is a neutron source developed at the Service Electronics Research Laboratory—S.E.R.L.—Baldock, for defence purposes. This does not sound the sort of thing that could have a useful civil application, but it happens that there is growing interest in the use of high intensity fast neutrons for the treatment of cancer. The theory behind this belief stems from the fact that some malignant cells are difficult to destroy by treatment with X-rays or gamma radiation, but that they are more susceptible to damage by neutron irradiation. The neutron source produced at Baldock is now being developed to produce an experimental prototype of a kind of source which could be used for cancer treatment.
As far as we know, no other work in this field is going on in any other country, so that it looks as if we might achieve a break-through in treatment here. I do not need to emphasise how much this could mean in human terms, the curtailment of suffering and possible saving of life, quite apart from the obvious possibilities of domestic and export sales if everything turns out as we hope. One could not have a better case of making the best use of a piece of research and development begun for purely military purposes. S.E.R.L. is working with two firms and Manchester Hospital in this rather exciting development.
The other example is a device developed at the Admiralty Research Laboratory—A.R.L.—Teddington, to prevent the onset of cavitation corrosion in diesel-engine piston liners. Having talked to the scientists on the spot, I have experience of this. This most useful device was made available to industry through the National Research and Development Corporation—N.R.D.C.—but no one in Britain has so far showed enough interest in it to take it on. This is a case of failure to make a civil application, through no fault of the defence establishment.
In this second case, the N.R.D.C. and the A.R.L. have tried for eight years, during which N.R.D.C. has held the patent, to interest British industry, and only one firm got so far as to ask what royalty would be payable. We are still trying to encourage someone to make an

offer for the licence, but the results so far are disappointing. This is work done to lengthen the life of diesel propulsion units for the Navy—with a direct civil application, but not yet grasped by our diesel engineering manufacturers. This is not a give-away and I hope gradually to establish that our defence R. & D. establishments are not to be at all times regarded as a milch cow for industry: rather there should be a higher degree of co-operation and, where possible, a fair return for work done.
What can we do to improve matters? It seems to me, at first sight, that there are several sizeable obstacles to making more and better use of naval R. & D. for civil applications. To some extent defence security causes difficulty but much less than is thought. So far as this is concerned, I intend to encourage wider use of the "open days" which are already a feature of several of the establishments I have been to, and more frequent professional seminars held on particular subjects at which scientists of related disciplines can discuss current affairs. I find that our scientists are not really too inhibited in this field, and restrictions are, so far as I can judge, applied only where they are absolutely necessary. However, exchanges of this kind should be encouraged.
Another obstacle, which I think is a harder one, is commercial security, coupled with a definite lack of interest and organisation in some industries. I suppose that it is quite reasonable for an industrialist to consider that information supplied from a Government establishment, which is free to everybody, is not likely to be of much value to him personally. On the other hand, a valuable application is much more likely to be exploited for the profit of a particular firm, and the benefit is not widespread.
Here, I think that what is needed is to encourage more people in private industry to become aware of what is going on, in the hope that as they take a more active interest, they will develop further for civil uses some of the work which is started in aid of the defence programme. Britain's resources of qualified scientists and technologists are scarce, and we have got to make the best use of them.
Now I would like to deal with a problem very much on my desk, that


of cost escalation and cost control. There is a tendency for the costs of research and development programmes to escalate, even in the best regulated establishments. This is a most important matter, because value for money is crucial, and if costs tend to rise during research and development, the price of production too is going to escalate. It is no good our producing the best equipment of this sort if it is too expensive to give our own Services enough of it, let alone sell it to our friends.
For this reason, if ever I visit the establishments or the firms engaged in the defence programme, I give them the message that we have got to curb the constant tendency for weapon projects to escalate in cost during research and development through to production. If the price is right, then the firm will work itself into further orders. If not, we shall go elsewhere—price is the paramount consideration.
My chief adviser in the projects sphere is Sir William Cook, the Chairman of the Weapons Development Committee, and he and I intend to subject every defence R. & D. project, new or existing, to the most stringent examination of cost-effectiveness. If the project fails that test at the R. & D. stage, it will not go through to production. But if we can secure real cost-consciousness at an early stage and carry it through to production, then Ray Brown, the Head of Defence Sales, and I will help to the limit to sell that equipment to our friends.
It is in the interests of the Defence Department, as much as of industry, to secure longer production runs by sales which keep down the price to us, and increase profits for the firm. What is good business for me as Minister of Defence for Equipment will be good business for the firms as exporters—and, I think, good business for the taxpayer, which is where the money comes from in the first place.
This is a new job of mine. It has not been tackled before; we have never had a Minister of Defence for Equipment. I am the Government agent, or the customer, which will mean, and has already meant in some instances, talking toughly to our suppliers. Some would

describe me, although I hate the term, as a trouble-shooter. In the past I have keenly felt the necessity for this type of job to be done. It may prove difficult, but with the support of the House there is no reason why we should not succeed.

9.28 p.m.

Rear-Admiral Morgan Giles: It really is astonishing, having sat here all day, to hear this discussion on defence matters wound up by an Under-Secretary who is responsible for the equipment of our forces and who, at a very rapid speed, dismissed the aircraft carrier in just one sentence. "Oh", he said, "that would cost us £65 million. No, we cannot consider that". Not, be it noted, "We do not need one". Not that it is not necessary, because everyone concerned with defence affairs knows very well that this is the one type of ship which will secure the possibility of our carrying out the declared policies of the Government in the Far East.
This is dismissed with a wave of the hand, as being too expensive. We have had all this astonishing stuff about civil applications, and nothing about the forces and this ship which the Government must have. This subject has been debated regularly during the last couple of weeks. We have constantly asked that there should be consideration not of a £65 million carrier, but of a cheaper carrier, which would be able to carry seaborne air power. This is what we want to hear about, rather than the sort of stuff that we have had.

Question put and agreed to.

Resolved,
That a sum, not exceeding £34,655,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of scientific services, including a subscription to the International Hydrographic Bureau, which will come in course of payment during the year ending on the 31st day of March, 1968.

VOTE 5. MEDICAL SERVICES, EDUCATION AND CIVILIANS ON FLEET SERVICES

Resolved,
That a sum, not exceeding £19,258,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of medical services, educaton and civilians on Fleet services, which will come in course of payment during the year ending on the 31st day of March, 1968.

VOTE 8. MISCELLANEOUS EFFECTIVE SERVICES.

Resolved,
That a sum, not exceeding £11,449,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of miscellaneous effective services, including a grant in aid, which will come in course of payment during the year ending on the 31st day of March, 1968.

VOTE 9. NON-EFFECTIVE SERVICES

Resolved,
That a sum, not exceeding £25,562,000 be granted to Her Majesty out of the Consolidated Fund to defray the expense of non-effecive services which will come in course of payment during the year ending on the 31st day of March 1968.

Orders of the Day — DEFENCE (ARMY) ESTIMATES, 1967–68

VOTE 1. PAY, &C. OF THE ARMY

Resolved,
That a sum, not exceeding £184,940,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the pay, &amp;c., of the Army, which will come in course of payment during the year ending on the 31st day of March, 1968.

VOTE 2. RESERVE AND CADET FORCES

Resolved,
That a sum, not exceeding £10,140,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of the Regular

Army Reserves (including other ranks to a number not exceeding 45,000) and the Territorial and Army Volunteer Reserve (to a number not exceeding 115,000 all ranks) (including within these Reserves the Special Army Volunteer Reserve to a number not exceeding 8,700 all ranks), and of the Cadet Forces, which will come in course of payment during the year ending on the 31st day of March, 1968.

VOTE 8. MISCELLANEOUS EFFECTIVE SERVICES

Resolved,
That a sum, not exceeding £8,880,000, be granted to Her Majesty out of the Consolidated Fund, to defray the expense of miscellaneous effective services, including grants in aid, which will come in course of payment during the year ending on the 31st day of March, 1968.

VOTE 9. NON-EFFECTIVE SERVICES

Resolved,
That a sum, not exceeding £44,680,000, be granted to Her Majesty out of the Consolidated Fund to defray the expense of non-effective services, including a grant in aid, which will come in course of payment during the year ending on the 31st day of March, 1968.

Orders of the Day — BUSINESS OF THE HOUSE

Ordered,
That the Proceedings on the Consideration of the Lords Amendments to the Parliamentary Commissioner Bill and on the Motion relating to Prices and Incomes (S.I., 1967, No. 106) may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. MacDermot.]

Orders of the Day — PARLIAMENTARY COMMISSIONER BILL

Lords Amendments considered.

Mr. Speaker: I understand that it would be for the convenience of the House if we were to take together Amendments Nos. 1 and 9; Amendments Nos. 2 and 3; Amendments Nos. 4, 5, 6, 7 and 8; and Amendments Nos. 10, 11 and 12.

Clause 5.—(MATTERS SUBJECT TO INVESTIGATION.)

Lords Amendment: No. 1, in page 4, line 10, leave out subsection (4).

9.34 p.m.

The Financial Secretary to the Treasury (Mr. Niall MacDermot): I beg to move, That this House doth agree with the Lords in the said Amendment.
This Amendment is to leave out the existing subsection (4) of Clause 5 and Amendment No. 9 which we are discussing with it is to insert a new subsection in Clause 12—in page 9, line 28, at the end to insert:
() It is hereby declared that nothing in this Act authorises or requires the Commissioner to question the merits of a decision taken without maladministration by a government department or other authority in the exercise of a discretion vested in that department or authority.
The intention behind the Amendments is to remove the risk of any possible misinterpretation of subsection (4) of Clause 5. The Government's intentions in respect of the powers of the Parliamentary Commissioner in relation to Ministerial discretion have been the same throughout the history of the Bill, and they have been made clear throughout.
The original White Paper of October, 1965, said in paragraph 11:
The Commissioner will be concerned with faults in administration. It will not be for him to criticise policy, or to examine a decision on the exercise of discretionary powers, unless it appears to him that the decision has been affected by a fault in administration.
When the Bill was introduced, it did not deal explicitly with that point, as the Government took the view that it was inherent in the word "maladministration" itself. But the Lord President dealt with the matter again in his Second Reading speech, when he said:

What about the definition of maladministration? In the first place I can define it to some extent negatively. It does not extend to policy, which remains a matter for Parliament. Nor do we include under maladministration that whole group of discretionary decisions which Sir John Whyatt treated separately in the first part of his Report. Discretionary decision, properly exercised, which the complainant dislikes but cannot fault the manner in which it was taken, is excluded by this Clause."—[OFFICIAL REPORT, 18th October, 1966; Vol. 734, c. 51.]
He was referring there to Clause 5.
When the matter was considered in Standing Committee, we went into it in greater detail, and again I reaffirmed the Government's position. But it was strongly argued that the position in respect of discretionary decisions ought to be made clear on the face of the Bill, and so it was that the Government introduced on Report in this House the present subsection (4) of Clause 5.
When I moved that Amendment, I said explicitly that it was a drafting Amendment making clear once again the stated intentions of the Government. There was a tendency among some hon. Gentlemen opposite and subsequently in the Press to suggest that the insertion of the subsection represented a change of policy and a deliberate emasculation of the whole scheme by the Government. That was wholly untrue, as anyone who has studied the record dispassionately would have known.
The matter was considered in another place and, as a result of the debate there, the Government have accepted that the wording of the subsection and, more important, its position in Clause 5, which has the marginal note, "Matters subject to investigation", might lead to misunderstanding. It might be argued that the effect of the subsection in that position would be to preclude an investigation altogether where there was a discretionary decision. I do not myself take that view, because it is clear from the words, "review by way of appeal", that the subsection was limited in the way that I said when I moved it. However, others have thought otherwise, and the Government are anxious only to achieve the purpose that I stated before, which is to put the matter beyond doubt.
Accordingly, these two Amendments were moved in the Lords on Report by the Government. The placing of this provision in Clause 12 rather than in


Clause 5, together with the slightly revised wording which now appears on the Order Paper, make it abundantly clear that the right of the Parliamentary Commissioner to investigate maladministration is not being restricted in any way.
He may investigate an allegation of maladministration in relation to a decision irrespective of whether or not the decision is in the exercise of a discretionary power. But if he finds that there is no maladministration, he cannot then review the proper exercise of that discretionary power, because to do so would be setting himself up as a court of appeal, and almost all of us are agreed that that is not a power which we wish to confer upon the Parliamentary Commissioner.

Sir John Hobson: I desire only to say that we are grateful to the hon. and learned Gentleman for the explanation he has given. I entirely concede that the Government have always made it clear that they intended the Bill to be a very emasculated one, and the power of the Ombudsman to be strictly limited. We pointed out, on Second Reading, that the Bill itself did not make that clear, and for that reason we put down two Amendments in Committee, one to say that discretionary decisions should be or could be investigated by the Ombudsman, and one to say that they could not. It was from this that the Government eventually realised that whatever they may have thought the Bill meant, it did not, as originally drafted, clarify what was the Government's declared intention. That the Bill has made the position clear, is a claim which the Government cannot advance, because at this last minute they are having another shot at drafting what was their intention.
I am bound to say that this Amendment achieves the purpose which they have always declared, of limiting very strictly, and to a miniscule number of cases, the power of the Ombudsman, and we are grateful for the Government for getting it right in the end.

Sir Lionel Heald: I associate myself with my right hon. and learned Friend the Member for Warwick and Leamington (Sir John Hobson) in welcoming this Amendment, but we shall spend a moment or two on it because I do

not think that the hon. and learned Gentleman who moved the Amendment has done nearly sufficient justice to another place and to the Lord Chancellor, because after the matter had been raised here and brushed aside by the hon. and learned Gentleman, as well as the Lord President, it went to another place, and the Lord Chancellor, after giving the matter the usual careful consideration one would expect, associated himself entirely with the views which have been expressed from this side of the House—in which I had the honour of playing a small part—that as it stood it was strongly argued that part of the Clause which is now to be struck out would have the effect that it would be sufficient to show that there was an exercise of discretion in order to exclude the jurisdiction of the Ombudsman.
It may be said that it was agreed that that was not the intention, but, after all, we are concerned with the wording of Acts of Parliament. What is said by Ministers is of no value whatever in the courts. One has only to look at the wording as it is now to see the difference.
I will not read the wording, but the essence of the difference is that the words "without maladministration" have been inserted. That is to say, not a question of the merits of any decision taken in the exercise of discretion, but only if it is without maladministration.
That is exactly what we wanted, but as it stood it was certainly open to argument. If we refer to the actual words used by the Lord Chancellor we find that there is, between the hon. and learned Gentleman who moved the Amendment and the Lord Chancellor, apparently complete difference of opinion, because the Lord Chancellor said that he appreciated that there was a real danger that someone in authority might say, "You must read this wording strictly", and the Ombudsman would have no business whatever to consider this particular thing at all.
We now have the situation that the Ombudsman is left in the position of deciding whether there is maladministration or not. I think that all of us had some doubt. Certainly much more learned people than myself had doubts about it in another place as to whether the word "maladministration" was capable of definition.
I think we would probably agree, certainly as regards the future occupant of the important position of Parliamentary Commissioner, that it would be quite safe to leave it in his hands to decide whether he considers that there has been maladministration or not, which is, I suppose, really a question of fact, or a question of opinion, at any rate. Therefore, I feel that we should accept this with gratitude. The Lord Chancellor made another important point in relation to drafting instructions.
9.45 p.m.
He said that the point which I have been repeating, I hope at not too great length, had additional strength owing to the position of the subsection in the Bill. He said that as it was in Clause 5 which is headed "Matters subject to investigation", it was the kind of thing which would be likely to be looked at and construed very strictly, and therefore this was an additional reason for making the change which we now have.
I venture to suggest that before we part with this we should realise that this is one of those occasions when the other place has performed a very important function, because the Government adopted a dictatorial attitude which they have so often adopted recently with regard to legislation, and in this case it was the Lord Chancellor in another place who was able to put the Government in their proper place.

Mr. Michael English: With respect to the right hon. and learned Member for Chertsey (Sir L. Heald) I think that in his last remarks, perhaps unwittingly, he was speaking nothing but a considerable amount of rubbish. It seems to me that the House of Lords has merely served the useful function of being an extra stage in the passing of legislation so that what was always intended to be in the Bill could be inserted in it. There is no criticism by the House of Lords or by hon. Gentlemen opposite which calls for congratulations.
I would have thought that this was a simple, straightforward issue, and had the right hon. and learned Member been on the Committee he would have realised that there were genuine difficulties, on both sides, over the best way of putting into legal form what the Committee wanted

in the Bill. At one point hon. Gentlemen opposite made great play of the word "maladministration". I, of course, exempt the right hon. and learned Gentleman from that. He knows better than most hon. Members that many phrases which have been inserted in Statutes by this House have subsequently come to have a technical meaning, although they did not have such a meaning originally.

Sir Douglas Glover: Disgraceful.

Mr. English: It is not disgraceful. This is what the House is for. It is here to create new techniques in a legal sense. It is here to legislate.
In this instance there were genuine difficulties in Committee. By a majority, which could not possibly fail to include hon. Members from both sides, the Committee took out certain portions of the Clause and left it so wide that the Parliamentary Commissioner could have acted as a court of appeal from the House of Lords and indeed from any other court in the land. It was therefore necessary to put something back, and this was done on Report in this House and again subsequently, in an improved form, in the other place. It was not then, and is not now, a party issue, and it is a bit much for hon. Gentlemen speciously to congraulate themselves on this provision now being in the Bill.
However, I did not really stand up to say that. I have one question to ask my hon. and learned Friend about the Amendment. Can he, with his legal knowledge, assure us that it will be possible within the terms of this restriction for the Parliamentary Commissioner to state in his report who made the decision which was the exercise of the discretion on whose merits he may not comment? It seems to me that there is an important point here. If the question complained of is taken with a degree of maladministration, obviously in his report the Commissioner will say whether it was so, either in the process leading up to the discretionary decision or in the process following from it. He will be able to say so, which is what we wanted in Committee. This is highly desirable, but there is something else which is desirable.
Perhaps the Commissioner, who is an officer of Parliament, should not comment on the merits of a discretionary


decision. The Amendment forbids him to do that. Such a discretion is a political decision—though not necessarily in party terms—and the proper people to question about it and to question it are in the House. I want to be sure that the proper person will be questioned and that the Commissioner will not be prevented from doing what he exists to do, namely, removing some of the secrecy which shrouds Government and administration in this country—[HON. MEMBERS: "Hear, hear."] Hon. Members opposite agree, but I notice that they did not introduce this Measure to remove secrecy while they were in office. But I do not want to make party points.
In a system of Government as complex as ours, discretionary decisions may be technically vested in a Department, a Minister or a body like the British Railways Board but such decisions are, in fact, exercised by one or more of many thousands of people. It may interest the House to know the exact level—even if it was not desired to reveal the actual people—at which such decisions were taken.
I should like to be assured that the Commissioner could do this. If he decided that, although he could not inquire into the merits of a decision because there was no maladministration, but the case occurred at, for example, the level of Assistant Secretary and not of Minister, could he say so?

Dame Irene Ward: Having listened with interest to both sides of the argument, I would say "Thank God for the Lord Chancellor". Perhaps I am unduly suspicious, but, surely, if he had defined what we are now putting into the Bill when it was first drafted, the Amendments could have been avoided. I suspect, as I always have, that, having decided to appoint a Parliamentary Commissioner, the Government got "cold feet", because they have reduced—

Mr. Speaker: Order. The hon. Lady must not generalise on this Amendment.

Dame Irene Ward: It is very tempting, Mr. Speaker, when I could not take part in the original—

Mr. Speaker: Order. The hon. Lady must resist temptation.

Dame Irene Ward: Still, I think that it has some relevance to the Amendments that the Bill was weak before it reached another place. It has come back to us just a little stronger, which is of great advantage. I do not think that to say that would be out of order.
When the Commissioner reports on any cases—I say this because I had the good fortune, at the Commonwealth Parliamentary Association meeting in New Zealand in 1965, to move a resolution about the establishment of an Ombudsman or Parliamentary Commissioner—

Mr. Speaker: Order. The hon. Lady really must come to the Amendment.

Dame Irene Ward: It relates to the Amendment, Mr. Speaker, if I may be allowed to say this. I went deeply into the matter, naturally, because I had to move a Motion about it. The Parliamentary Commissioner will, it seems, have to report on every case with which he deals and presumably—

Mr. Speaker: Order. With respect, this has nothing to do with the Amendment.

Dame Irene Ward: The hon. Member for Nottingham, West (Mr. English) referred to the report which the Commissioner will make. I therefore thought that I would be allowed to refer to it.
I merely want to know whether, when the Commissioner reports on matters of maladministration, discretion or whatever it may be, he will, as a result of this Amendment, be able to draw attention to a weakness in the law relating to the case which he has been called upon to investigate. It will be important for the Commissioner to present a full picture and to say whether a weakness in the law has caused the maladministration, or whether it was maladministration to begin with—in the sense that somebody maladministered, through a lack of understanding, the law as it stands. I would like to know how far the powers of the Commissioner will be involved in a case of this kind.

Sir D. Glover: My hon. Friend the Member for Tynemouth (Dame Irene Ward) came to the nub of the problem in her closing remarks, although I agree


with you, Mr. Speaker, that she got rather wide of the Amendment earlier in her speech.

Mr. Speaker: Order. I think that the Chair needs no support from the hon. Gentleman.

Sir D. Glover: I was making a friendly and uncontroversial remark, but I accept your rebuke.
As I was saying, my hon. Friend came to the nub of the problem when she asked whether the Commissioner will be able to deal, even if we accept the Amendment, with certain matters. Will he merely be able to say, "This occurred as a result of maladministration," or is it the case as adduced by the hon. Member for Nottingham, West (Mr. English), that the Commissioner will be able to say that because of the inefficiency of Parliament, which produced legislation which was so verbose or opaque that it was unclear to those who had to administer it, that the difficulty arose? In other words, will the Commissioner be able to say that the hon. Member for Nottingham, West or the hon. Member for Ormskirk had not done their job properly to ensure that the legislation was crystal clear?
When I said "disgraceful" when the hon. Member for Nottingham, West was speaking, I was not making a personal remark. I meant that I sometimes believe that we in Parliament do not realise the enormous importance that lies on our shoulders to ensure that, when we allow a Bill to leave this place, it is clear not only to erudite lawyers and Q.C.s, but to the ordinary man in the street so that he can decide the course of action best suited to him. When I said "disgraceful" I was indicating that all too frequently we allow Bills to pass without ensuring that they can be clearly understood by all concerned.
I welcome the Amendment, although I have little enthusiasm for the Bill. The Government have performed a miracle of medical science in that they have produced a eunuch without any medical activity, and—

Mr. Speaker: Order. The hon. Gentleman must come to the Amendment.

Sir D. Glover: With great respect, Mr. Speaker, I had got only half way through

a sentence when you pulled me up. Even if the Amendment is accepted, it is doubtful whether the Parliamentary Commissioner will be able to inquire into cases of departmental maladministration deeply enough to satisfy hon. Members who, in any case, already have considerable powers and influence in delving into departmental affairs. We must, therefore, wonder whether this gentleman will be able to do any more than we can do already.
If the Parliamentary Commissioner cannot achieve any more than hon. Members can already achieve then, although the Amendment is acceptable and improves the Bill, I still believe that it leaves the Commissioner with such attenuated powers that it is very doubtful indeed whether he can provide any real buttress to the activities of the individual Member of Parliament.

10.0 p.m.

Mr. MacDermot: With the leave of the House, Mr. Speaker, may I say that I am very glad of the reception which these Amendments have had from hon. Members on both sides; and that hon. Members opposite appear satisfied that we now have it right. I certainly think, and the Government think, that the present wording is an improvement on the previous drafting, otherwise we would not have moved the Amendment. I quite agree with the right hon. and learned Member for Chertsey (Sir L. Heald) that we are indebted, as we have been on many other occasions, to the Lord Chancellor for his contribution, and indebted in respect of the opportunity we have had to improve Bills in another place, as we have done on this occasion.
All I sought to do in my introductory remarks was to refute the misleading suggestions made in the Press and elsewhere that there had been some change of intention or change of mind on the part of the Government in relation to these matters. The right hon. and learned Gentleman the Member for Warwick and Leamington (Sir J. Hobson) again trotted out the argument that it was the intention of the Government to produce an emasculated Bill.
I am delighted to see the right hon. and learned Member for St. Marylebone (Mr. Hogg) coming to join us again, because he fervently advanced that as one


of his arguments at various stages of the Bill. I do not wish to disrupt the harmony of our proceedings, but I would remind hon. Members opposite that it was this precise proposal that they considered would put such a fetter on the working of the Executive that it should be rejected, and they did reject it on that ground.
My hon. Friend the Member for Nottingham, West (Mr. English) asked whether with the amended wording it will be possible for the Parliamentary Commissioner in making his report to identify who had made the decision, and I think that my hon. Friend was more particularly concerned at the level at which the decision had been made. It would certainly be within the Commissioner's power but, as a matter of practice, as has been stated before, one would hope that only in exceptional circumstances would he want to identify by name particular civil servants. We want to preserve the anonymity of the Civil Service. But he might think it important to draw attention to the level at which the decision had been taken, particularly if he thought the matter was of such importance that it should have been referred to a higher level. That would be within the scope of the Commissioner's powers.
I can also give an affirmative answer to the hon. Lady the Member for Tynemouth (Dame Irene Ward) on a matter that was raised in Committee. I have already given the assurance that the Commissioner would be able, in his report, to draw attention to what appeared to him to be any defect in the law which was leading to a situation which could be described as maladministration.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Order. Perhaps the hon. and learned Gentleman will decide to whom he is giving way.

Mr. MacDermot: To the hon. Lady the Member for Tynemouth.

Dame Irene Ward: I thank the hon. and learned Gentleman for giving way, and also for what he has said. Does his assurance extend to injustices in the law as well as to weak law?

Mr. MacDermot: The aspect of injustice with which the Commissioner

is concerned is an aspect arising from maladministration. If he thinks that some administrative procedures are leading to injustice as a result of a statutory provision or a Statutory Instrument or other legislation, he would be entitled to draw attention to it, and I imagine that he would de so.

Sir J. Hobson: Sir J. Hobson rose—

Mr. Speaker: Order. The right hon. and learned Member for Warwick and Leamington (Sir J. Hobson) has exhausted his right to speak, but may intervene before the hon. and learned Gentleman sits down.

Sir J. Hobson: Before the hon. and learned Gentleman sits down, Mr. Speaker, I want to ask him for a little help on the point raised by the hon. Member for Nottingham, West (Mr. English). It concerns whether these provisions will not now enable the Parliamentary Commissioner, in a case where there is some maladministration, however small, to embark on a consideration of the exercise of the discretion. Under the Amendment, if he finds any maladministration, can he go into the whole matter of how the discretion was exercised?

Mr. MacDermot: If the Parliamentary Commissioner finds that there has been maladministration, he will then direct his mind to the question of whether injustice had been caused by it in his view and I do not see how he can do that without considering the merits. I agree that he would have to consider the merits if only for that purpose. If he thought that injustice had or might have resulted, he would presumably so report and suggest to the Department concerned what action he thought ought to be taken.

Question put and agreed to.

Subsequent Lords Amendments agreed to.

Clause 10.—(REPORTS BY COMMISSIONER.)

Lords Amendment No. 4: In page 7, line 32, leave out "the House of Commons" and insert "each House of Parliament".

Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.

Mr. Speaker: I suggest that we discuss, at the same time, the following four Amendments.

Mr. MacDermot: The effect of the first three Amendments is to provide that the three types of report which the Parliamentary Commissioner will publish should be laid before both Houses of Parliament and not just before the House of Commons, and the other two Amendments are consequential. I should make it clear that these Amendments have no effect upon the ordinary report in an individual case which he will make to the Member of the House of Commons who has referred the case to him.
All we are concerned with here are the other reports which the Parliamentary Commissioner will make under the provisions of Clause 10(3) and (4). There will, first of all, be the special report which will arise in a case where he is in disagreement with a Department about whether sufficient action has been or will be taken to correct what he conceives to be injustice arising out of maladministration.
In such circumstances, the Minister responsible might be a Member of the House of Lords and not of the House of Commons. Equally, an ex-Minister might have taken the decision concerned and now be a Member of the House of Lords. Accordingly, it appeared to the Government right that reports of this nature, which are, after all, public documents—there is nothing confidential about them—should be laid before both Houses because, clearly, they could involve a matter which might arise for debate in the other place.
Having taken that decision, it appeared equally right that the reports dealt with in subsection (4)—in particular, the annual report—should also be laid before both Houses. On the Report stage here, we made an alteration in the Bill to provide that the Parliamentary Commissioner could be removed only in consequence of an Address from both Houses. The point was raised in another place that, in view of this, it was right that the Parliamentary Commissioner's reports should be laid before both Houses so that the House of Lords could be equally appraised of the progress of his work and of his office. That appeared to us to be reasonable; hence these Amendments.

Sir J. Hobson: When the Bill was before the House, we pointed out that, in the form in which the Bill would leave the House, it appeared that the Commissioner, although he was called a Parliamentary Commissioner, would be a House of Commons Commissioner only, because he was linked almost exclusively to the House of Commons throughout the Bill.
Therefore, we greatly welcome these Amendments. They will at any rate mean that the House of Lords, which has an equal interest in the liberty of the subject and in the rights of citizens and which has always been closely associated, by its judicial nature, with that type of work, will have some part in debating and considering the reports of the Commissioner.
As this will affect the House of Lords and this House, may I ask when it is expected that the House of Lords and we ourselves will begin to get the reports and when the Commissioner will begin to operate?

Mr. English: I am not surprised that—

Mr. Speaker: Order. I should be grateful if the hon. Gentleman would speak up. I find great difficulty in hearing him.

Mr. English: I am not surprised, Mr. Speaker, that the right hon. and learned Member for Warwick and Leamington (Sir J. Hobson) concurs with the Amendment, because in Standing Committee the whole of the Opposition voted against the Amendment which the Committee made and which has been partly nullified by these Lords Amendments. Government back bench Members defeated both the Opposition and the Minister in Committee and deleted all reference to the House of Lords from the original Bill. I accept that this reference has not been replaced in other parts of the Bill, but it is replaced here. [An HON. MEMBER: "So what?"] An hon. Members says, "So what?" The point is of some importance, and I shall be glad to attempt to explain what the point is.
In this case—I am dealing strictly with these Amendments only to stay within the rules of order—the Ombudsman will lay his report before both Houses of Parliament. What is unstated in the Clause but what is based upon the Clause


and what has been known throughout all our debates is the Select Committee to which the Reports will go in this House, and presumably now also in the other place. It will be extremely difficult for the Parliamentary Commissioner to serve two masters instead of one. That is the point which arises on these Amendments.
I rather regret that the Government have accepted these Amendments, but I see their point. The argument which my hon. and learned Friend advances is, I take it, that, since the report is to be published anyhow, there will be no harm in formally laying it before the House of Lords as well as the House of Commons. The only difference between publication, in the normal sense of the word, and laying it before the House of Lords is, presumably, that now this will give the House of Lords the right to do what it cannot do initially under the terms of the Bill as it stands, although it could under the terms of the Bill as originally introduced. Peers cannot raise complaints in the House of Lords or as Members of the House of Lords, although they can do so as ordinary citizens through their Member of the House of Commons.
What they will now be able to do is presumably exactly what it is proposed to do in this House, namely, to consider in a Select Committee all the possibilities and details, to bring forward and, indeed, to suggest procedures to the Commissioner. Throughout the Committee stage it was asserted that the Commissioner would no doubt frequently consult the Select Committee; no doubt he would listen to its opinions and its suggested methods of conducting inquiries, and so on. He would not be bound by the Select Committee, but no doubt he would listen to it. This was said in Standing Committee.
Now the Commissioner will presumably have two such bodies to listen to, and these will often no doubt be in conflict. This will make the position of the Commissioner that much more difficult. In all conscience it is surely difficult enough already. I rather regret that the Government have gone back on the situation which their back benchers created in Standing Committee. The majority of the Committee struck out the reference to the House of Lords in both initiation and subsequent consideration, and I think

it possibly disadvantageous that that principle, which was decided by this House, has not been adhered to.

10.15 p.m.

Dr. M. P. Winstanley: I welcome the opportunity to offer the broad support of my right hon. and hon. Friends on this bench for this group of Amendments. Perhaps I may say, in passing, that we should have offered even more enthusiastic support for certain other Amendments which their Lordships considered, but which, unhappily, have not appeared on the Notice Paper with these.
It has been argued that the need for an Ombudsman or Parliamentary Commissioner has been caused by certain deficiencies which have arisen in this place, in other words, because it has been impossible in many ways, for perfectly good reasons, for Members of the House of Commons to do certain of their jobs. In a way, we have proceeded in a typically British fashion. Finding something wrong with an institution, instead of putting it right we have put another institution on top.
That is what we have done, but this group of Amendments improves the situation considerably. If there is a deficiency in this place—I make no criticism of hon. Members; the process of events and the way things have evolved have given rise to the problem—the more the other place can be brought into the matter the better.
I happen to be one in this Chamber—perhaps there are not many—who believes that there will come a time when the Labour Party will honour its election pledge of 1929 to give us a democratic and representative Second Chamber.

Mr. Speaker: Order. That is very interesting, but it cannot be discussed now.

Dr. Winstanley: With great respect, Sir, I believe that the time will come when the other House will be reformed and that, when it is reformed, it will be necessary for the Second Chamber to be brought into these proceedings at every possible stage. It would be most regrettable if it were left out of this Bill.

Mr. Speaker: Order. We are not at that stage now. We are considering whether the report should be presented to the other place as well as to this. The


hon. Gentleman must keep to the Amendment.

Dr. Winstanley: I am glad that the report is to be presented to the other House. Even at this time, this will be very useful, but I am certain that the time will come when it will become even more useful. I offer the general support of my right hon. and hon. Friends, therefore, for this group of Amendments, which will go a long way to improve the Bill as a whole.

Sir D. Glover: I was appalled at the speech of the hon. Member for Nottingham, West (Mr. English), who wants the Parliamentary Commissioner—I emphasise that his title is Parliamentary Commissioner—to be restricted to the House of Commons and not to serve Parliament as a whole.
When the hon. Gentleman says that Members of another place can make representations through their Members of Parliament, he forgets that Members of the other place have no vote, so that they have no Members of Parliament. Moreover, we in this House are the Lower House of Parliament. Parliament is one whole. There is the House of Commons, the Lower House, and there is the House of Peers, the Upper House. At some stage, this House, or Parliament as a whole, may decide that it would like to alter that position, but we are dealing here—

Mr. Speaker: Order. This may be an interesting excursion into constitutional problems, but the hon. Gentleman must discuss the Amendment, which is that the report shall be submitted also to the other House.

Sir D. Glover: I had finished my historical reference, Mr. Speaker, and all I was about to say when you intervened and brought me to order was that the present position is that we have Parliament as we understand it, the Lower House and the Upper House, and I regard it as an enormous improvement—

Mr. Anthony Royle: Is not Parliament the Lower House, the Upper House and the Sovereign together in one Assembly?

Mr. Speaker: Order. The hon. Member should not tempt the hon. Gentleman who has the Floor.

Sir D. Glover: To show you the virtues I have in my heart, Mr. Speaker, I nearly said that earlier, but realised that it would have been more out of order and restricted myself to the two Chambers.
In fact, the two Chambers are Parliament. We in this House are not Parliament; we are the Lower House of Parliament. If there is to be a Commission dealing with deficiencies of the governmental machine it seems to me only logical that the members of the other half of Parliament should have access to the reports in the same way as a Member of this House.
Therefore, I do not understand the attitude of the hon. Member for Nottingham, West, who thinks that that should be restricted to the Lower House, the House of Commons. He said that there might be administrative difficulties. Because the Parliamentary Commissioner would be serving two masters, the reports would have to go to two Select Committees. That is what is known as an administrative difficulty and is not something which we in this House or in Parliament as a whole should concern ourselves with. If it is right that the report should go to both Houses of Parliament the administrative difficulties can be overcome.
I accept that there is a problem, but if we accept that Parliament is made up of both Houses I consider that both Houses have an equal right to get the Commissioner's report and we should not try to put ourselves in an advantageous position.

Mr. MacDermot: Perhaps I can first allay the fears of my hon. Friend the Member for Nottingham, West (Mr. English). There is no question of there being two Select Committees to which the Parliamentary Commissioner will report. I understand that there is no intention by the other House to seek to set up a Select Committee. I think that it is accepted by them that the Parliamentary Commissioner will basically be an Officer of this House and will report to a Select Committee of this House.
A situation might arise when a member of another place would be criticised in one of the reports. He might choose to appear before our Select Committee or to defend himself in debate in the


other place. For that reason, we thought that these were appropriate Amendments.
I was asked when the Parliamentary Commissioner would be able to begin work. We hope that it will be at the beginning of next month.

Mr. English: Would my hon. and learned Friend explain how he can prevent the other place setting up a Select Committee if it wishes to do so?

Mr. MacDermot: There is no need for me to do so because there is no such intention.

Question put and agreed to.

Subsequent Lords Amendments agreed to.

Schedule 2.—(DEPARTMENTS AND
AUTHORITIES SUBJECT TO INVESTIGATION.)

Lords Amendment No. 10: In page 12, line 19, leave out "Ministry of Aviation".

Mr. MacDermot: I beg to move, That this House doth agree with the Lords in the said Amendment.

Mr. Speaker: It might be for the convenience of the House to consider with it the following Lords Amendments, No. 11, in page 12, line 36, leave out "Ministry of Land and Natural Resources" and insert "Land Commission"; and No. 12, in page 13, line 3, at end insert "Social Survey".

Mr. MacDermot: The three Amendments are consequent upon the dissolution of the Ministry of Aviation and the Ministry of Land and Natural Resources, the establishment of the Land Commission and the creation of the Social Survey as a separate Department, which has already been announced.

Question put and agreed to.

Remaining Lords Amendments agreed to.

Orders of the Day — PRICES AND INCOMES (JOSEPH BOURNE AND SON LTD.)

10.25 p.m.

Mr. Terence L. Higgins: Mr. Terence L. Higgins (Worthing) rose—

Mr. Charles Fletcher-Cooke: On a point of order, Mr. Speaker. I understand that we are now to discuss Statutory Instrument No. 106, made under the Prices and Incomes Act. This Order concerns, and concerns only, the persons employed by Joseph Bourne and Son Ltd., and only those who are employed at the Denby Pottery in Derby, a very limited concern and, I should have thought, a very private concern. Surely on principle it is right that our procedure should be such that those private persons should have a chance of being heard either in person or by counsel under the traditional procedures of this House since this does not affect the body of the citizens as a whole but a very small and very particular number of persons.
For that reason, is it right that this debate should be compressed into a matter of an hour whereas these people who are alone concerned by this Order have no opportunity of being heard?

Mr. Speaker: I am afraid this is a point of argument and a point of difference between the hon. and learned Member and the Government. It is by no means a point of order. Mr. Higgins.

Mr. Higgins: I beg to move,
That the Temporary Restrictions on Pay Increases (20th July 1966 Levels) (No. 2) Order 1967 (S.I., 1967, No. 106), dated 1st February 1967, a copy of which was laid before this House on 1st February, relating to employees of Joseph Bourne and Son. Ltd. at the Denby Pottery, Derby, be withdrawn.
This Motion is concerned with yet another Prices and Incomes Order which the Government have made as part of their compulsory prices and incomes policy. Throughout the debates which have taken place on the Prices and Incomes Act and the Orders which have arisen under it, we on this side of the House have made plain that we are totally opposed to the Government's use of compulsion and, in particular, the element of discrimination and intimidation involved. For this reason, the House

may well sympathise with the point made by my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) that this particular Order discriminates against a very small group.
It has been typical of all the Orders we have debated under the Act that they tend to discriminate against very small groups. The smallest, I think, consisted of two people. Therefore, it is right and proper that we should oppose the element of compulsion, intimidation and discrimination which this Order involves. I hope that my hon. Friends will join with me in dividing the House on this matter.
It is very important to place this Order in the context of the current economic environment. Following the severely deflationary measures of last July, which were necessitated by the Government's failure to take action earlier, the Government's stance on incomes policy is no longer what it was in the heyday of the Declaration of Intent, that of King Canute trying to hold back a flood of wage claims and price increases. Rather it seems to me that King Canute is now swimming parallel to the shore under the impression that he is being saved by a compulsory lifebelt when the reality of the situation is that the economic tide has ebbed and the compulsory lifebelt is not doing anything to help.

Mr. Speaker: The hon. Member will come to the Order, I hope.

Mr. Higgins: Yes, I was endeavouring to demonstrate that compulsory Orders of this kind are not necessary.

Mr. Speaker: It is only this one that we are concerned with.

Mr. Higgins: Indeed, this particular Order would not be necessary when the Government had taken deflationary measures which, in any case, would prevent the granting of inflationary wage claims. The fact of the matter is, of course, that it is quite impossible to tell from what the Government say whether they really believe that the stabilisation of wages over the last six months has been due to compulsion or due to deflation, and this is something which we certainly failed to establish through Questions related to this very point only yesterday.
I want to turn first of all to a point which came up in an earlier debate on


a similar Order and the position of the Prices and Incomes Board, because it seems to me that in considering this Order also the Prices and Incomes Board is far from irrelevant. The Joint Parliamentary Secretary to the Ministry of Labour, in the debate on the limb-fitters' case, said:
The Government are committed to and bound by whatever recommendation the Board may make."—[OFFICIAL REPORT, 7th March, 1967; Vol. 742, c. 1423.]
I hope that he will clarify, on this Order, whether people in the position in which some may regard those affected by this Order to be that of "low-paid workers" have any option as to whether a report is made by the Board.
It would appear that the Board's recommendations are being accepted as binding by the Government. This certainly was the implication of what the hon. Gentleman said on the earlier occasion. If this is so I think it is right that the House should know whether these reports are to be accepted automatically in each case—this would seem to us a dangerous infringement on the powers of this House—or, if they are not to be accepted automatically, whether the Government will give us the criteria on which they decide to accept the recommendations, or not.
I want to turn now to the particular history of this case within the framework which I have outlined. The history really begins with a pay increase which was claimed by some 550 employees of Joseph Bourne and Son Limited. This firm is one of the largest employers in the small, specialised stoneware industry, The pay and conditions of the 1,500 workers in this industry are controlled by the National Joint Wages Board for the stoneware industry. It is important to remember that such a wages board is not the same thing as a wages council, which is, of course, a statutory body set up to ensure that low-paid workers do receive adequate remuneration. The National Joint Wages Board we are concerned with here is a voluntary body, and there is not a Ministry of Labour inspector.
None the less, I think it would be interesting for the House to know whether the Joint Parliamentary Secretary feels that the people who are

covered by the Order which we are now discussing should or should not be regarded as "lowest paid workers" within the terms of the various Prices and Incomes White Papers.
The minimum rate of pay in the industry before the wages increase which we are now discussing was something like £10 10s. 1½d. a week. The average earnings have been variously estimated. I understand the Joint Parliamentary Secretary's colleague, the Chancellor of the Duchy of Lancaster, estimated them to be some £18 15s. whereas the Minister himself estimated them to be £17. I hope that the hon. Gentleman will clarify this. At all events, the basic wage even the average earnings, are below the national average of £20 6s. We should be grateful, therefore, if the hon. Gentleman would tell us whether he thinks that these people are "lowest paid workers" within the meaning of the Act, or not.
On 22nd June the Wages Board agreed to an increase of 15s. 6d. on the basic rates, to be payable from 15th August, which is one of the crucial dates in this matter, and a reduction of hours from 41 to 40 per week from 3rd April this year.
On 5th August, the employers' association told the unions that the increase would be deferred for six months in accordance with the standstill on prices and incomes. The employees in other firms accepted this postponement and they have in fact received the increase from 15th February, this year, six months after the original proposed increase, in other words, the normal six months' deferment which the Government's prices and incomes policy involves.
However, the main union involved with the 550 workers refused to accept this deferment and one of its members, a Mr. Morris, employed by Bourne and Son, brought a test case and issued a summons for breach of contract. At this stage, the firm gave written notice, under Part IV which was invoked, as the House will recall, on 6th October, that the increase would be postponed, and it claimed that while it was liable for payment of the increase from 15th August to 5th October it was not liable from 6th October. The situation at this point was that the firm felt that it was protected by Section 30 of the Prices and Incomes Act.
On 21st October, a judgment was given for Mr. Morris in which the judge held that the rates of remuneration before 6th October were the increased amount, even though in fact that amount had not been paid. The firm decided to accept the judgment and not to appeal. I should like the Parliamentary Secretary to clarify whether that sum of money for the intervening time has been paid. I hope that he will enlighten the House about that.
Of course, the fact that this individual had secured a court decision jeopardised to some extent the position of the firm and of the Government, because other people could have obtained similar judgments. So, on 13th January the Government gave notice of intention to make the Order, which we are now debating, to forbid the firm from paying the increase from the date of the Order's coming into force. Despite discussions, they failed to reach agreement on a voluntary arrangement and the Order was therefore made and brought into force on 2nd February.
At this point, it is relevant to consider the Government's attitude. In a Press release they said that the Government's intention in making the Order was that
employees of Denby Pottery should be no better off, as a result of the award at Derby County Court in December, than were other workers in the stoneware pottery industry and in other industries whose pay has been deferred in accordance with the standstill".
This is the declared intention of the Government in this matter.
As with all such Orders which we have debated, some very important points of principle arise. The first is not that which arose with the police draftsmen when there was a question of whether the issue was sub judice. This one is similar to the Thorn case, because the Government are seeking to overrule a court decision confirming that a group of workers were entitled to receive a pay increase. We on this side of the House regard that as deplorable, because when an agreement is freely entered into by both sides in a firm, we think that it is right and proper that that agreement should be kept, particularly so when its validity has been specifically upheld by a court decision.
The second point of principle concerns the quotation which I have just read

from the Government's Press statement. The House will recall that in some other cases, for example, that of the draftsmen, the Government have sought, when someone has actually managed to secure an increase to which the Government have thought they were not entitled, to grab back the increase and obtain re-imbursement. It appears that there is some inconsistency between that and the position which the Government are now adopting, when this Order merely seeks to restore equality between these covered by the Order and other workers in the industry. However, this is not entirely clear and I hope that the Parliamentary Secretary will clarify this, too.
As I understand it, what the Government are now doing is to impose a freeze on those who have managed to obtain the pay increase, under a court order, for six months. This will be a different six months to the period for which the other workers in the industry had their pay frozen. The question arises: are the Government merely going to freeze both groups for six months. The people who did not get the increase because they volunteered to abide by the Government's policy, and the people who refused to volunteer and who are now forced to have their increase deferred, or will those who are covered by this Order have their pay frozen for rather more than six months, so that the remuneration which they receive in the interim period is effectively paid back as well?
This is an important point of principle, and one which I hope that the Parliamentary Secretary will clarify. The question also arises as to what is the position about the second part of the pay agreement, which was authorised by the Wages Board? What is the position about the reduction in the working week from 41 hours to 40, which is due to come into effect on 3rd April? Is this to be frozen, or will the workers have the benefit of this. Are all the workers in the industry to get it, or only those who have been affected by this Order?
I want to anticipate an argument which the hon. Gentleman may use. We have, on a number of occasions, heard of pleas for the universality, or the comprehensiveness of the Government's incomes policy. I should not be surprised if the hon. Gentleman were to say that it was


essential to freeze the pay of these 550 workers because, otherwise, it would be unfair to the other 1,000 or so workers in the industry who had volunteered to abide by the Government's decision.
This would be a valid argument, if the Government could reasonably say that the group covered by this Order were the only group receiving a pay increase. The House knows that this is not so, and is well aware that the idea that the Government's incomes policy is universal is a myth. I hope that if the hon. Gentleman puts forward this argument tonight, he will first of all tell us what percentage of the total labour force is represented by trade unions and what percentage of all wage and salary earners are covered by existing statistics. As my hon. Friend the Member for Oswestry (Mr. Biffen) is frequently keen to point out, we cannot believe in the Government's incomes policy if they simply do not have the statistics to show that it is justified.

Mr. Speaker: Order. If the hon. Gentleman responds to the invitation he will be out of order.

Mr. Higgins: I was pointing out that the argument which we constantly get for this and similar Orders is that it is in some sense a universal policy, covering everyone, and if one group of people got out of line the Government are ready to put an Order on it. The point I am trying to make is that it simply is not true that the Government's policy is universal. It is a myth to suppose that is, and I am challenging the hon. Gentleman to show that he even knows what wage increases have taken place. I would suggest, with the greatest respect, that this is extremely relevant to the Order. Similarly, we might reasonably ask the hon. Gentleman which group of people in the period of freeze, secured increases inconsistent with the wages policy.

Mr. Speaker: Order. Again with respect, the request for statistics and for information about other groups, are completely outwith this Order.

Mr. Higgins: I naturally bow to your Ruling and will proceed with my peroration. I do not want to dwell on the disillusionment with the present Government which is evidently rife in the National Society of Pottery Workers, still

less on the fact that it may have felt obliged no longer to support the party which this Government represent. I do not want to do this because I think it would give credence to the view that by imposing this Order the Government like this are in some sense being tough with the unions in a broad sense. I think it is clear that what the Government are doing is not being tough with the unions in any broad sense. What they are doing is taking a big stick against individuals, and against individual unions. This is what they are doing.
They are really attacking the whole basis of free collective bargaining, the whole basis that contracts shall be entered into freely by both sides of idustry, and that these contracts shall be honoured by those who have entered into them. They are striking at the base of industrial relations in this country by introducing the element of compulsion which they have, and it is for this reason that I hope my hon. Friends will join me in the Division Lobby tonight.

10.46 p.m.

Mr. John Biffen: My hon. Friend the Member for Worthing (Mr. Higgins) has outlined the history of this rather sad case, and I fully endorse the charges which he has laid against hon. Gentlemen opposite.
I should like to confine myself to three relatively small points which arise from this Order, and I hope that the Joint Parliamentary Secretary will seek to assure me on them. The first comes under the Schedule, where there is a reference to Joseph Bourne and Son Limited. The point of particular significance about Joseph Bourne and Son Limited is that under the provisions of the 1965 Finance Act it is a close company. I assured myself of this fact by telephoning the company this afternoon and speaking to one of the executives.
As a result of accepting this Order, and not successfully praying against it, the profits of the company will rise by the amount of wages which it will not have to pay, and a pre-determined share of that increase in its profits will have to go in increased dividends. This has been fully accepted by the Government when pressed on this point from both sides of the House, and this is something which everyone concerned with the supposed equity of


the prices and incomes policy should bear in mind on this Order, because it concerns a close company.
My second point arises from the remarks made by my hon. Friend. The Department of Economic Affairs made a Press release on this issue and said:
The Government's intention in making the Order is that the employees of Denby Pottery should be no better off, as a result of the award at Derby County Court in December, than other workers in the stoneware pottery industry"—
and then comes what seems to be the relevant phrase—
and any other industries whose pay has been deferred in accordance with the standstill.
This again presumes that there is almost universal concurrence with the prices and incomes policy, and that a few anti-social people are thought to be infringing it.
But this is the myth world in which the Ministry of Labour operates. Nobody else believes this, and surely even the credulity of the Joint Parliamentary Secretary must be a little strained on this point, because it is not a question of straying into the realms of order about statistics. It is a question of reminding the hon. Gentleman that the Association of Supervisory Staffs Executives and Technicians has boasted of 41 instances in which it has infringed the standstill and severe restraint.
In generosity, I taxed the Joint Parliamentary Secretary on this point. I asked him what was to be done about it so that one could have a consistency of action and the people whose wages we are now discussing could see that everyone else was in the same cart—a sort of fair shares of misery. The Joint Parliamentary Secretary said:
I am not proposing to pursue these anonymous cases."—[OFFICIAL REPORT, 13th March, 1967; Vol. 743, c. 6.]
I can only say that the crime is visibility. If people can be easily identified, as the workers in this instance could be, they will reap the full rigours of Government action.
Why were these workers so easily identified? It was because they had recourse to a court of law. It is an extraordinary progress in the concern of this House for the conditions of employees that workers should incur the wrath of Par-

liament because they go to the courts of law, when we know, not only from the answers of the Joint Parliamentary Secretary but from our own observations in our constituencies, that there are many instances of people getting increases every month, such as were sought, and successfully sought, by the 150 workers at Joseph Bourne and Son Limited.
My last point conerns, again, the fair shares in misery, because as a result of this Order the workers at Joseph Bourne and Son Limited will take a six months' freeze which will cover a period different from that of other workers in the stoneware pottery industry. I think I am correct in saying that the freeze for the other workers ran from roughly last August until February of this year—I see that the Parliamentary Secretary confirms that view. So, by way of compensation, the workers at Joseph Bourne and Son Limited will have their wages frozen from February, presumably, until six months later. The Parliamentary Secretary has not confirmed that view, but I presume that what I have said is correct.
There is no guarantee of equality of treatment at all. Other things are not equal, and the most unequal factor in this situation is that we have in prospect the Budget, which could easily change tax rates and thereby totally alter the actual take-home pay, even though the proposal is that the workers at Joseph Bourne and Son Limited should be put on the same footing as other workers in the stoneware pottery industry. It is merely an act of faith. The Joint Parliamentary Secretary does not know what is in the Budget, and even if he did he could not tell us this evening.
I therefore come to the conclusion that the Order is the product of bumbling bureaucracy. It is quite unnecessary. I cannot believe that the Government's economic policy is so much in jeopardy that it requires this kind of Order. It is high time the Parliamentary Secretary allowed a little sunshine into his soul. If he were to accept our Motion he would be showing respect for the law and allowing the worker to be worthy of his hire. I hope that, on full consideration of these arguments and those of my hon. Friend the Member for Worthing, we will have the unprecedented example this evening of the House of Commons actually triumphing over the Executive.

10.54 p.m.

Mr. Stan Newens: I do not wish to delay the House for very long, but I think it appropriate that an hon. Member on this side should speak on this Order. As I understood the Government's prices and incomes policy, it had as one of its objectives the giving of justice to the lower-paid workers. Nobody can maintain that the workers whom we are now discussing are other than lower paid. Pottery workers are not greedy workers, and this firm's workers are not in a very lucrative position when one considers that of employees all over the country.
The Pottery Workers Society is certainly one of the most conciliatory trade unions. It has no record of bitter strikes, and there is no history—at least in this century—of turbulent industrial relations. In fact labour relations in general have been characterised by very considerable restraint over a good number of years by the pottery workers' leaders.
I lived in the Potteries for a number of years and got to know many pottery workers very well, although I do not know the firm with which this Order is concerned. But I know that pottery workers are extremely industrious men and extremely willing in the work they are prepared to do.
It is quite unjust that they should be singled out on this occasion for the sort of treatment which they are receiving here. As has already been pointed out, very few workers are involved, but at the same time these few workers are to be crushed by Government action and are to be subjected to our action in the House this evening. At the same time, having said all these things, I want to make it quite clear that I can give no support to many of the arguments put forward by the Opposition, because I consider that hon. Members opposite are only too keen to exploit this issue for crude political purposes.
The pottery workers, like most lower-paid workers, do not owe very much to the Opposition, and although it is delightful at this stage to see the sudden twinge of conscience which seems to have swept through many of the ranks opposite, I feel that that attitude may well disappear in other circumstances. I only wish that we had had on other occasions

the spectacle of the Opposition lamenting—

Mr. Speaker: Order. What we have had on other occasions is outside this Order.

Mr. Newens: At the same time, having made these points, I still am in the position in which I feel I am quite unable to support the Government in the Division Lobbies this evening, and it is not merely on this Order that I take this point of view. I took it in connection with other Orders of the same variety, and I consider that my action this evening is consistent with the point of view which I, and a number of my hon. Friends have expressed throughout the many debates we have had on the Government's prices and incomes policy.
It seems to me that this Order illustrates very clearly the flaws which exist in the Government's policy with regard to prices and incomes and I cannot believe, despite reconsidering this matter very carefully, that it is right to make this section of workers an example in the cause of seeking to put the country's economy on a firm footing. As has already been said, other workers are receiving increases, and many workers are getting away with considerably bigger increases than those which we are considering in the case of the pottery workers covered by the terms of this Order.
I consider that the Order is unjust in the extreme, and it is creating a very strong sense of injustice among the type of workers who are likely to be affected by this policy. We all know very well that prices have risen and many people are being obliged to face these ever-increasing prices on the same incomes. They certainly are not happy about doing this while they see that other people, for some reason or another, have not been obliged to accept the restraint which has been imposed upon them. In these circumstances I appeal to my hon. Friend to review his attitude very carefully before he kinds up the debate.
Even if nothing is done on this occasion, I hope that the Government will keep in view the spectacle of being obliged to place the burden of trying to put the country's economy right on small groups of lower-paid workers in this way.


It is totally unjust. I do not believe that it has anything to do with the Socialism of which I am proud to be an advocate. In these circumstances, I repeat that I shall be unable to support the Government in the Division Lobby.

11.1 p.m.

Mr. F. A. Burden: The hon. Member for Epping (Mr. Newens) has made an extraordinarily interesting speech. I believe that it arose from long association with the Potteries. Indeed, one is led to wonder what would have happened had he been representing a constituency from that area. He might well have come into the Lobby with the Opposition.

Mr. Newens: Mr. Newens indicated dissent.

Mr. Burden: At least, had it not been for this Motion, he would not have been able to voice his remarks, which I hope the Joint Parliamentary Secretary to the Ministry of Labour will take to heart.
The Order penalises 150 workers of a firm in the Potteries. It denies to them wage increases agreed to with the firm. The contract had been properly made. As my hon. Friend the Member for Oswestry (Mr. Biffen) pointed out, this being a close company the money saved as a result of non-payment of these increases will now go out in increased dividends.
I remind the Joint Parliamentary Secretary that these are lower-paid workers. The minimum wage is £10 10s. 5½d. a week, rising, presumably with full overtime, to £18 15s. [Interruption.] I wish that my hon. Friend the Member for Ormskirk (Sir D. Glover) would restrain himself until called by Mr. Speaker.

Sir Douglas Glover: I was just saying to my hon. Friend the Member for Oswestry (Mr. Biffen) that his was a jolly good speech—better than the one which my hon. Friend the Member for Gillingham (Mr. Burden) is making.

Mr. Speaker: Order. I hope that we can get on without interruptions.

Mr. Burden: What my hon. Friend the Member for Ormskirk says may well be so. Although I may not speak as well as my hon. Friend the Member for Oswestry (Mr. Biffen), at least I do not make speeches as often as he does.

Mr. Speaker: Order. I hope that we can now get back from these pleasantries to the Order.

Mr. Burden: My hon. Friend the Member for Ormskirk did rather call for comment, Mr. Speaker.
I want to ask the Joint Parliamentary Secretary what wage increases had been agreed to in this case. How much and to what extent would these workers have benefited? This is very important. We should know what increases are being denied to them. The information would indicate to what extent they were going outside the incomes policy.
Certain firms are being caught and their workers are having wage increases denied to them. Not a great number of Orders like this are being laid denying workers in particular firms wage increases agreed between them and their employers, but in how many cases are wage increases being given by small firms which are not known by the Minister? What happens to these people? They get their wage increases. It is impossible for the Ministry to impose a wage freeze throughout industry, especially where workers may not belong to a trade union. I should like to ask the Parliamentary Secretary how many more likely cases there are in the pipeline on which Orders will come before the House.

Mr. Speaker: The Minister is not able to answer that. It would not be in order as he must keep to this Order.

Mr. Burden: I should like to know from the Joint Parliamentary Secretary what amount of the output of this firm goes to exports. Exporting is one of the things we want to encourage and surely workers in factories which do a considerable amount of export business should be encouraged to work even harder and give us greater output and production to help us put the balance of payments and the overseas trade balance right. The export performance of this firm is important, because the workers, having been denied this increase, if they have been engaged in a big export drive, will not be encouraged to continue and we may have falling rather than rising production. One of the worst features of the Government's attitude is represented by some of the niggling little


actions they are taking by means of Orders like this one.
I hope that we will be told by the Joint Parliamentary Secretary that as a result of the timing of this Order the workers in this factory will not in the end suffer in comparison with others in the industry when their time comes to get an increase.

11.8 p.m.

Mr. Charles Fletcher-Cooke: May I ask a short question about the effect of this Order?
In the relevant Section of the principal Act the effect of the Order is that the employer shall not pay the increases in wages involved while the Order is in force. The Order presumably falls when Part IV of the Act expires. When that happens does the obligation under the order of the court revive?
Is the employer then, under the order of the court, obliged to pay what the court ordered? If so employers are presumably not obliged to declare a dividend, as was so ably pointed out by my hon. Friend the Member for Oswestry (Mr. Biffen). If not, presumably they are obliged under the relevant Finance Acts to increase the dividends thereby. Surely they are entitled to know what their obligations are as regards this money when August arrives and Part IV disappears. Is the obligation not to pay a temporary one during the force of the Order or does it remain for ever and a day?

11.9 p.m.

Sir Douglas Glover: May I start by apologising to my hon. Friend the Member for Gillingham (Mr. Burden)? I know how upsetting it is when another hon. Member intervenes or speaks during one's speech. I think that I was charged with a good deal more than I was responsible for, because there was a lot of talking going on behind me. I interjected for only a short period. Having got the record straight, I will go on.
This debate concerns one of the most important constitutional problems that any Parliament can consider, namely, the freedom and the rights of the individual. Benjamin Franklin, if I may misquote him, said that those who give up freedom to solve a little temporary difficulty

are worthy of neither freedom nor independence. This is what the Government are doing. They are producing machinery which is the total negation of everything that the Tolpuddle martyrs and all the others who built up the independence and freedom of the working community stood for.
The Order is entirely arbitrary. My hon. Friends the Members for Oswestry (Mr. Biffen) and for Worthing (Mr. Higgins) made it clear that this is not all-embracing machinery. All of us know of case after case where wage and salary increases have taken place by the expedient of moving people from one position to another. The Government seem to have adopted an unfortunate attitude in all the Orders we have debated. This is another classic example. They seem never to deal with 1,200 people. They seem always to deal with two or 20 or 50 or, in this case, 150.
How much of this firm's output goes in exports? What is the increase or reduction in the firm's productivity? In other words, is this wage increase justified on the firm's increased efficiency? If so, that increase is in the national interest and is not an on-cost on to our national efficiency. If these workers, with the help of the management, have increased their production and their efficiency, they are entitled to a wage increase. Have these aspects been considered?
This company has gone to law. The House is dealing with a law which is superior to all other laws. Despite the fact that the court has said that a certain course of action shall be carried out, by the Order the Government say that that action shall not be carried out. I am sorry that the Joint Parliamentary Secretary shakes his head. What I have said is true. This is why these Orders come before the House. This is why we are having this debate. This makes nonsense of the courts and of the whole legal system. The longer this practice continues the greater the disrepute which will be created.
This is the first Order of this type which affects a close company. What argument can the Government advance to these workers to justify this action, because the workers know that under the Socialist Finance Act money to the tune of the wages of which they are


being deprived will, to the extent of 60 per cent., have to be paid to the shareholders in increased dividends.

Mr. Robert Sheldon: It is a pity that three hon. Members who sat through at least part of the discussion on the Finance Act have so far tried to misrepresent the workings of that Act because it was then explained that any distribution made must be such as to show that the company has no plans for investment, either now or in the future.

Sir D. Glover: I am very grateful to the hon. Member for that intervention, but the company is apparently in the position that anything it does to increase its efficiency will be counterbalanced by the action of the Government. If it increases its efficiency, it will now get no benefit for having done so, although it is a valid argument that this money will be used for investment. With the Government's present proposals, under which there is a lower rate of productive output, and investment is dropping by 10 per cent. in private industry next year according to reliable estimates, there is surely not a very strong argument to support the claim that this extra money, filched from the pockets of the workers, will be used to invest in the factories and so on, but will be used for the purpose of increased dividends.
It is not really fair to blame the Joint Parliamentary Secretary. He is not responsible, but what is he going to say? At least let us get away from the miasma which surrounds this whole subject. We are not dealing here with digits, but with human beings going home to talk to their families, to talk to their wives and children. To those people the Government are saying, "You have produced an efficient result and you deserve an increase in pay, but you cannot have it. The company has increased its dividends, and now you see the wife of the managing director driving around in the third motor car." How can the Minister justify that to the workers? The Government are virtually forcing the company to pay an increased dividend. I hope that the Joint Parliamentary Secretary will produce some satisfactory answer to this great and important question.

11.18 p.m.

The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Roy Hattersley): Winding up in a debate which has largely consisted of questions which have been ruled out of order imposes a difficulty on any Parliamentary Secretary, but, within the rules of order, I want to make two comments on the speech of the hon. Member for Worthing (Mr. Higgins).
The hon. Gentleman asked if this Order—and, by implication, I take it that the seven other Orders against which Prayers have been laid in this House are also included—is relevant to Government economic policy. He asked if the wage policy over the last six months was a policy of deflation or of compulsion. He posed his antithesis, but it was a false antithesis. The economic recovery in which we are engaged is, in part, a result of those deflationary measures which were announced by the Prime Minister last July. At the same time, wage restraint is an essential part of the process, but that is very different from compulsion.
Some hon. Members opposite seem to think that the only way in which wages can be held in line with the two White Papers on the standstill and the period of severe restraint is by what they call compulsion. In fact, most wage stability has come from the voluntary acceptance of the standstill and severe restraint.

Mr. Speaker: Order. I have kept other hon. Members to the Order. The Parliamentary Secretary must keep to the Order. We cannot widen the debate.

Mr. Hattersley: I am much obliged, Mr. Speaker. I shall, if I may, leave that point and turn to the specific matter before us. [Laughter.] I understand that it is "must", not "shall" or "may".
I want to deal with four points which have been raised, all of which are central and germane to the argument. I accept the chronology as outlined by the hon. Member for Worthing. The facts as he stated them are correct. Some time before 20th July, the union and the employers came to an agreement both on the date when the settlement would come into operation and the amount which should be given, the amount being rather less than 5 per cent. of the basic wage.
Under the terms of the Government's prices and incomes policy and the standstill and severe restraint White Papers, the union was entitled to receive that increase six months after the original operative date. That is to say, they were entitled to receive it not on 15th August but on 15th February. The basic argument is about whether the Government were right in insisting to one section of the union and one firm in the Federation that the six months' postponement should be put into effect.
The first question which the Government then asked themselves, and which they were required to ask, was whether these workers were entitled under the prices and incomes policy to some preference because they were "lowest-paid workers". I emphasise that paragraph 28 of the severe restraint White Paper, Cmnd. 3150, talks about that, about "lowest-paid workers", not about "low-paid workers" or "lower-paid workers." If the Government had promised special concessions to lower-paid workers it might be argued that people earning less than the national average came into that classification. But the Government's policy is quite specific: it talks about the "lowest-paid workers".

Mr. Burden: How does one determine who is the lowest-paid worker, in which industries, in what trades, and would it apply to everyone in every trade who is found to be the lowest-paid in the trade?

Mr. Hattersley: If the hon. Gentleman will contain himself for a moment, I shall come to just that definition.
The Government, naturally and properly, considered whether the members of this union employed at this firm were lowest-paid workers. I emphasise that that consideration was done by the Government. The union and the men themselves never applied for special consideration under that aspect of the prices and incomes policy. Until the union discussed their position with my right hon. Friend the Chancellor of the Duchy of Lancaster and myself on 31st January, the idea that they were among the lowest-paid workers in the country was never in their minds. The consideration was done by the Government. It was certainly not done by the men.
The Government are, of course, guided in their decisions about where one of the lowest-paid workers is to be found by several criteria, the criteria laid down by the Prices and Incomes Board. There are two special and specific examples. The board, talking about employees in agriculture, diagnosed them as lowest-paid workers because their hourly rate was about 5s. 9d. an hour. Talking about workers in the retail drapery trade, the board had reservations on whether they were lowest-paid workers because their pay was 7s. 11d. an hour. In fact, the average pay of workers in Joseph Bourne and Son is the same, 7s. 11d. an hour. Therefore, if we are to rely on the judgment of the Prices and Incomes Board in those two specific examples to which it turned its mind in considering who are lowest-paid workers, the workers at this factory do not qualify.
Many other criteria have been laid down from time to time.

Mr. Thomas Swain: Will my hon. Friend, as a responsible Minister of the Crown, tell us what is a lower-paid worker? [HON. MEMBERS: "Lowest."]

Mr. Hattersley: I have explained to the House, I hope, that our task is to decide not what a lower-paid worker is but what a lowest-paid worker is. I have been telling the House that the Government are properly guided in these matters by the Prices and Incomes Board. They have other advice as well, to which my hon. Friend may listen with a more sympathetic ear—from the General Secretary of the largest union in the country, Mr. Frank Cousins, who says that the lowest-paid worker is someone who earns £15 a week or less.
The workers of this factory earned an average of £18 17s. 5d. a week in the summer when earnings were high because of overtime. In the winter months, when the earnings were slightly less because overtime was slightly less, they earned an average of £17 9s. 6d. a week. By the perhaps exacting standards of Mr. Cousins they do not qualify as lowest-paid workers.

Mr. Michael Alison: When all the lowest-paid workers have


been brought up to the level of the lower-paid workers, do the lower-paid workers then become the lowest?

Mr. Hattersley: The answer is perfectly straightforward, which I think is more than one can say for the question. When the lowest-paid workers have received additional remuneration another set of lowest-paid workers take their place at the head of the queue. That is something to do with redistribution, which this party was formed to bring about.
The hon. Member for Worthing also asked how long the Order was to remain in force. He knows very well that the majority of the workers in this industry who voluntarily accepted the freeze were denied—if that is the right word—the pay increase for six months. I cannot give him or the union any very specific assurance about the date on which the Order will cease to be in force. Of course, it lapses on 11th August, when Part IV of the Prices and Incomes Act lapses, but my right hon. Friend is entitled under the Act to alter the Order, to withdraw it in part or in full if he chooses to do so in writing. It is not possible at this time to anticipate his decision.
It is possible to say that the other part of the agreement entered into by the union for implementation in April, the reduction in the working hours from 41 to 40 a week, will go forward. It is in no way part of the task of my right hon. Friend or my Ministry somehow to penalise the union or jeopardise their agreement to have a reduced working week. That is part of the agreement that can go on irrespective of the prices and incomes policy, and our agreement will be given for the reduction to go forward on 3rd April.

Mr. Higgins: If it is the Government's intention in making the Order, as they say, that the employees of the Denby Pottery should be no better off as a result of the award at the Derby County Court in December, than were the other workers in the stoneware and pottery industries, whose pay increases were deferred in accordance with the standstill, surely it is a matter of simple arithmetic to determine what the freeze period will be. Why will the hon. Gentleman not give it?

Mr. Hattersley: Simple arithmetic suggests that it would lapse on 2nd August, but it is not my right hon. Friend's policy to announce what his decision will be on that date. It is within his jurisdiction, and an announcement is likely to be made nearer the time.
Although this debate need not necessarily end at half-past eleven, I do not want to detain the House longer than necessary.
Three points were made by the hon. Member for Oswestry. The first was extraordinary, and one on which he may want to intervene and make a correction when I remind him of what happened the day before yesterday. He talked, as he has talked constantly over the last month, about firms and unions and individuals who, according to him, are ignoring the freeze and are breaking the line, and who are driving a coach and horses through the Government policy.
He quoted a written Answer I gave him on Monday, referring to a publication of my own trade union, which claimed that there were cases where it had already defied the freeze. He said that I replied:
I am not proposing to pursue these anonymous cases."—[OFFICIAL REPORT, 13th March, 1967; Vol. 743, c. 6.]
But in fact my Answer went on to say that many of them were in any case in conformity with the prices and incomes policy.
It is not good enough—

Mr. Biffen: Since the Joint Parliamentary Secretary has invited me to intervene, I gladly do so. He says, "many of them". How many are in conformity and how many are not?

Mr. Speaker: Order. We are getting away from the Order.

Mr. Hattersley: The second point that the hon. Gentleman made—I absolve him from the accusation of pursuing this for crude political purposes knowing that he is pursuing it because of a theological zeal for free enterprise, which obsesses him every Tuesday night—was that since the firm was no longer required to pay the increase in wages it would automatically, because of its close company status, translate it into greater profits, distributed or undistributed. What an extraordinary philosophy of industry! Has he not heard of reduced prices?
Hon. Gentlemen opposite ask about the export record of the firm. I am happy to say that it is a remarkable one; it is second to none in the industry. One of the reasons why the wage increases have been blocked by the Government is to keep the firm in that competitive position to enable it to sell abroad. [HON. MEMBERS: "Oh!"] One of the purposes of the incomes policy stipulated in both White Papers is to make sure that such a firm goes on with such an admirable export record.

Mr. Biffen: What we know is that the wage increase has been blocked. The hon. Gentleman talks about the possibility of prices being reduced. Can he tell the House what prices have been reduced by Joseph Bourne and Son Ltd., when, and how long the price reductions are expected to run?

Mr. Hattersley: Of course I cannot. The hon. Gentleman knows as well as I do that it is not simply a question of whether prices have been reduced. It is a question of whether they would have gone up if the increased wages had been paid. It is straightforward. He also knows that it is absurd to suggest that in some way the Government are overriding the decision of the courts. The men have been paid what the courts said they were entitled to. The hon. Gentleman asked whether the period in dispute had been cleared up, whether the wages

to which the men are entitled have gone into their pay packets. They have. What the courts said the men were entitled to has been paid to them.

What the Government have done is to say that the workers in the firm—rather fewer than 500—chose, uncharacteristically of the rest of the industry and the rest of the British working population, to break the line on incomes policy, and that the sacrifice—for sacrifice it is— that two-thirds of the industry has been prepared voluntarily to make in the interests of economic viability they should make as well.

The question that we must ask the hon. Gentleman is: If he believes in an incomes policy at all, is he saying that the Government should have an incomes policy but on occasions like this they should be prepared to turn their back on it? Is he saying that the Government should have an incomes policy but should allow people to break it? Is he saying that the Government should have an incomes policy but not for the more militant trade unions and the more determined individuals? We on the Government benches have no doubt about the answers to the questions. If there is to be an incomes policy it must be spread equally over the country and operated universally, and the Order is intended to ensure just that.

Question put:—

The House divided: Ayes 125, Noes 185.

Division No. 293.]
AYES
[11.34 pm.


Alison, Michael (Barkaton Ash)
Errington, Sir Eric
Hunt, John


Allason, James (Hemel Hempstead)
Eyre, Reginald
Hutchison, Michael Clark


Astor, John
Farr, John
Irvine, Bryant Godman (Rye)


Atkins, Humphrey (M't'n &amp; M'd'n)
Fisher, Nigel
Johnston, Russell (Inverness)


Barber, Rt. Hn. Anthony
Fietcher-Cooke, Charles
Jopling, Michael


Batsford, Brian
Fortescue, Tim
Kershaw, Anthony


Berry, Hn. Anthony
Gibson-Watt, David
Kimball, Marcus


Biffen, John
Gilmour, Sir John (Fife, E.)
King, Evelyn (Dorset, S.)


Biggs-Davison, John
Glover, Sir Douglas
Kirk, Peter


Birch, Rt. Hn. Nigel
Goodhew, Victor
Knight, Mrs. Jill


Blaker, Peter
Gower, Raymond
Lancaster, Col. C. G.


Bossom, Sir Clive
Grant, Anthony
Legge-Bourke, Sir Harry


Brewis, John
Grant-Ferris, R.
Lubbock, Eric


Brinton, Sir Tatton
Grieve, Percy
MacArthur, Ian


Bromley-Davenport, Lt.-Col. Sir Walter
Gurden, Harold
Maclean, Sir Fitzroy


Buchanan-Smith, Alick (Angus,N&amp;M)
Hall-Davis, A. G. F.
Maginnis, John E.


Burden, F. A.
Hamilton, Michael (Salisbury)
Maude, Angus


Carr, Rt. Hn. Robert
Harris, Reader (Heston)
Mawby, Ray


Clegg, Walter
Hawkins, Paul
Maxwell-Hyslop, R. J.


Cooke, Robert
Higgins, Terence L.
Maydon, Lt.-Cmdr. S. L. C.


Crawley, Aidan
Hiley, Joseph
Mitchell, David (Basingstoke)


Crouch, David
Hill, J. E. B.
Monro, Hector


Dance, James
Hirst, Geoffrey
More, Jasper


Davidson, James (Aberdeenshire,W.)
Hobson, Rt. Hn. Sir John
Morrison, Charles (Devizes)


d'Avigdor-Goldsmid, Sir Henry
Hogg, Rt. Hn. Quintin
Munro-Lucas-Tooth, Sir Hugh


Dean, Paul (Somerset, N.)
Holland, Philip
Murton, Oscar


Deedes, Rt. Hn. W. F. (Ashford)
Hordem, Peter
Nabarro, Sir Gerald


Doughty, Charles
Howell, David (Guildford)
Neave, Airey




Noble, Rt. Hn. Michael
Rossi, Hugh (Hornsey)
Wainwright, Richard (Colne Valley)


Onslow, Cranley
Royle, Anthony
Walker, Peter (Worcester)


Osborn, John (Hallam)
Russell, Sir Ronald
Webster, David


Page, Graham (Crosby)
Scott, Nicholas
Wells, John (Maidstone)


Pardoe, John
Shaw, Michael (Sc'b'gh &amp; Whitby)
Whitetaw, Rt. Hn. William


Pearson, Sir Frank (Clitheroe)
Smith, John
Wilson, Geoffrey (Truro)


Peel, John
Steel, David (Roxburgh)
Winstanley, Dr. M. P.


Percival, Ian
Summers, Sir Spencer
Wood, Rt. Hn. Richard


Pink, R. Bonner
Taylor, Edward M. (G'gow, Cathcart)
Worsley, Marcus


Prior, J. M. L.
Taylor, Frank (Moss Side)
Wright, E.


Ramsden, Rt. Hn. James
Teeling, Sir William
Wylie, N. R.


Renton, Rt. Hn. Sir David
Temple, John M.
Younger, Hn. George


Ridley, Hn. Nicholas
Thorpe, Rt. Hn. Jeremy



Ridsdale, Julian
Turton, Rt. Hn. R. H.
TELLERS FOR THE AYES:


Roots, William
van Straubenzee, W. R.
Mr. Francis Pym and




Mr. R. W. Elliott.




NOES


Albu, Austen
Garrett, W. E.
Ogden, Eric


Alldritt, Walter
Ginsburg, David
O'Malley, Brian


Allen, Scholefield
Gordon Walker, Rt. Hn. P. C.
Oram, Albert E.


Anderson, Donald
Gourlay, Harry
Oswald, Thomas


Archer, Peter
Gray, Dr. Hugh (Yarmouth)
Padley, Walter


Ashley, Jack
Grey, Charles (Durham)
Page, Derek (King's Lynn)


Bagier, Gordon A. T.
Griffiths, David (Rother Valley)
Palmer, Arthur


Bence, Cyril
Griffiths, Rt. Hn. James (Llanetty)
Parkyn, Brian (Bedford)


Benn, Rt. Hn. Anthony Wedgwood
Hamilton, James (Bothwell)
Pentland, Norman


Bennett, James (G'gow, Bridgeton)
Hamling, William
Perry, Ernest G. (Battersea, S.)


Birwis, John
Hannan, William
Price, Christopher (Perry Barr)


Bishop, E. S.
Harper, Joseph
Price, Thomas (Westhoughton)


Blackburn, F.
Haseldine, Norman
Price, William (Rugby)


Blenkinsop, Arthur
Hattersley, Roy
Probert, Arthur


Boardman, H.
Healey, Rt. Hn. Denis
Randall, Harry


Braddock, Mrs. E. M.
Henig, Stanley
Rees, Merlyn


Brooks, Edwin
Hobden, Dennis (Brighton, K'town)
Reynolds, G. W.


Broughton, Dr. A. D. D.
Hooley, Frank
Rhodes, Geoffrey


Brown, Rt. Hn. George (Belper)
Houghton, Rt. Hn. Douglas
Roberts, Albert (Normanton)


Brown, Bob (N'c'tle-upon-Tyne, W)
Howarth, Robert (Bolton, E.)
Roberts, Goronwy (Caernarvon)


Brown, R. W. (Shoreditch &amp; F'bury)
Howelt, Denis (Small Heath)
Robinson,Rt.Hn.Kenneth (St. P'c'as)


Buchan, Norman
Howie, W.
Robinson, W. O. J. (Walth'stow, E.)


Cant, R. B.
Hoy, James
Ross, Rt. Hn. William


Carmichael, Neil
Huckfield, L.
Rowland, Christopher (Meriden)


Carter-Jones, Lewis
Hughes, Roy (Newport)
Rowlands, E. (Cardiff, N.)


Coe, Denis
Hunter, Adam
Sheldon, Robert


Coleman, Donald
Hynd, John
Shore, Peter (Stepney)


Concannon, J. D.
Janner, Sir Barnett
Short,Rt.Hn.Edward (N'c'tle-u-Tyne)


Craddock, George (Bradford, S.)
Johnson, James (K'ston-on-Hull, W.)
Silkin, Rt. Hn. John (Deptford)


Crawshaw, Richard
Jones, J. Idwal (Wrexham)
Silkm, Hn. S. C. (Dulwich)


Crossman, Rt. Hn. Richard
Jones, T. A. (Rhondda West)
Slater, Joseph


Dalyell, Tam
Kelley, Richard
Small, William


Davidson, Arthur (Accrington)
Kerr, Dr. David (W'worth, Central)
Snow, Julian


Davies, Dr. Ernest (Stretford)
Lawson, George
Spriggs, Leslie


Davies, G. Elfed (Rhondda, E.)
Leadbitter, Ted
Swingler, Stephen


Davies, Ifor (Gower)
Lewis, Ron (Carlisle)
Thornton, Ernest


Davies, Robert (Cambridge)
Lomas, Kenneth
Tinn, James


de Freitas, Rt. Hn. Sir Geoffrey
Loughlin, Charles
Tuck, Raphael


Dell, Edmund
Lyon, Alexander W. (York)
Urwin, T. W.


Dewar, Donald
Lyons, Edward (Bradford, E.)
Varley, Eric G.


Dobson, Ray
McBride, Neil
Wainwright, Edwin (Dearne Valley)


Doig, Peter
MacColl, James
Walden, Brian (All Saints)


Driberg, Tom
MacDermot, Niall
Walker, Harold (Doncaster)


Dunn, James A.
McGuire, Michael
Watkins, David (Consett)


Dunnett, Jack
McKay, Mrs. Margaret
Watkins, Tudor (Brecon &amp; Radnor)


Dunwoody, Dr. John (F'th &amp; C'b'e)
Mackenzie, Gregor (Rutherglen)
Wells, William (Walsall, N.)


Eadie, Alex
Maclennan, Robert
Whitaker, Ben


Edwards, William (Merioneth)
McMillan, Tom (Glasgow, C.)
White, Mrs. Eirene


Ellis, John
MacPherson, Malcolm
Whitlock, William


English, Michael
Mahon, Peter (Preston, S.)
WilKins, W. A.


Ennals, David
Mahon, Simon (Bootle)
Willey, Rt. Hn. Frederick


Ensor, David
Mallalieu,J.P.W.(Huddersfield,E.)
Williams, Clifford (Abertillery)


Evans, Albert (Islington, S.W.)
Manuel, Archie
Williams, Mrs Shirley (Hitchin)


Evans, Ioan L. (Birm'h'm, Yardley)
Mapp, Charles
Willis, George (Edinburgh, E.)


Faulds, Andrew
Marsh, Rt. Hn. Richard
Wilson, William (Coventry, S.)


Fernyhough, E.
Maxwell, Robert
Winnick, David


Fletcher, Ted (Darlington)
Millan, Bruce
Winterbottom, R. E.


Foley, Maurice
Miller, Dr. M. S.
Woodburn, Rt. Hn. A.


Forrester, John
Milne, Edward (Blyth)
Woof, Robert


Fowler, Gerry
Moonman, Eric



Fraser, Rt. Hn. Tom (Hamilton)
Morgan, Elystan (Cardiganshire)
TELLERS FOR THE NOES:


Freeson, Reginald
Morris, John (Aberavon)
Mr. Ernest Armstrong and


Gardner, Tony
Moyle, Roland
Mr. Walter Harrison.

Orders of the Day — RAILWAYS (TYNESIDE)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Harper.]

11.43 p.m.

Mr. Geoffrey Rhodes (Newcastle-upon-Tyne, East): In the British Railways network map issued today there is the statement that
The system must not only provide freight and passenger services which are commercially sound but must also meet the needs of social and regional policy as decided by the Government
I want particularly to stress the word "regional" because tonight I want to contend that British Rail in recent years has not paid any consideration to the Government's regional policies for the north of England when deciding what development shall or shall not take place in that area. It is not making such considerations very significant in its decisions being taken at the moment; and furthermore, it does not appear likely to take into consideration the Government's policies for the region, in future unless some Ministerial intervention is made.
There are two major development areas in the north, the Northern Development Area and that in central Scotland. What disturbed some of us a few years ago was when in British Railways Map 21 it was made clear that the east coast run to Scotland, particularly that part between Newcastle and central Scotland, was not to be developed. At that time, some of us were already becoming apprehensive that in British Railways' thinking Newcastle-upon-Tyne was not terribly significant in terms of future development. In the last few years, when we have seen the tremendous speed-up of, for example, the rail services between Manchester and London, which has brought those two cities nearer together, Newcastle, and, for that matter, parts of Scotland relatively speaking have been getting further away.
More recently, we have seen what I have described elsewhere as a series of Beeching-type hatchet operations which, added together, make a pattern. A few years ago, the South Tyneside electric line was terminated and replaced by diesels which many warned would give slower, less frequent and less satisfactory

services than the electric trains. My hon. Friend the Member for South Shields (Mr. Blenkinsop), if he catches your eye, Mr. Deputy Speaker, will probably want to mention that.
We learned a lesson from South Tyneside north of the river and when we saw the plans for the end of the electric services there, and we fought them from the beginning, not with any conspicuous degree of success I regret to say. But we fought because we forecast, correctly, that when the electric service terminated, this month, the new service would be less satisfactory. We have already seen that the trains are slower and less convenient for the travelling public, especially mothers who want to put perambulators on the train. But, more important than that, most of the stations along that line will have a 33 per cent. cut in the number of trains which stop in the towns and villages in future.
All this rundown of services is taking place in the middle of a conurbation which is steadily becoming more integrated and in which the Minister of Housing has been considering creating a large new city of a million people. Therefore, if the old electric lines and the old electric stock on the system were out-of-date, in terms of future development of this conurbation it would have been a good thing to think in terms of increased capital investment and improved services, instead of providing the kind of diesel cast-offs which other areas have found redundant.
More recently still—and I do not intend to say much about this, because there was an Adjournment debate on it only about a week ago—there has been the proposed transfer of staff from the chief accountant's department at Newcastle to York and Peterborough. This was a decision taken by British Railways, a responsible public body, shifting staff from a development area to outside a development area, in complete contradiction to everything which other Government Departments are trying to do, which is to shift work to development areas.
Then we had the action this week to shut down the British Railways wagon sheet factory at Newcastle. There is no time now, but it would be interesting to go through the long and protracted correspondence which I have had with


Sir Stanley Raymond, Chairman of British Railways Board, on this subject. In all sincerity, I must say that I have yet to see convincing accountancy evidence that there was an economic case for shutting down this factory, but, even taking British Railways' own argument that future wagon sheet coverings would be pvc/nylon sheets, in terms of regional policy British Railways would have been well advised to have established a brand new factory for this purpose in the Newcastle area rather than concentrating the work and shifting it to Horwich and Worcester outside the development area.
As for motive power depôt staff, I have never seen so many disillusioned and frustrated men as those railwaymen who work in these depôts in the Northumberland area. There is a possibility, or a probability, of the closure of the Heaton power depot and the run-down of staff at Gosforth and Blyth, and a transferring of the staff to places outside the development area, possibly in the West Riding of Yorkshire.
I am fully aware that steam trains are going—we are not Luddites who do not want to see modernisation on British Rail. We believe that Britain Rail's future planning was in no way coordinated with the Government's economic objectives for the North of England. It should be planning investment and expansion rather than constantly telescoping and running down, and moving staff out of the region.
I do not know if British Rail is aware of this, but the Northern Region contains 5·7 per cent. of the insured working population of the country. Yet, the Industrial Development Certificates granted to the region by the Government account for over 20 per cent. of the new jobs being created. We welcome this. I believe that the region is unique in that it is a region where this year more houses will be built in both the private and public sector than last year. In terms of this rapid expansion in private sector housing, it is doing distinctly better than any other part of the United Kingdom.
The point is that there is a tremendous economic future being planned for the region by the Government, yet at the same time British Rail is taking

decisions which presume just the opposite. I know that the argument is constantly raised by British Rail that it has to cut back on uneconomic services. I know of no public transport system which is economic. If public transport road users had to pay for all the capital costs of road development, for renewal and repair, and for traffic control, there would not be a public service operator left in the country.
We object to the accountancy yardstick being used for this region, when it is based upon figures collected by British Railways in the period 1962–63–64–65, when it was in the depths of a recession. We want British Rail to re-cast its policies and to gear its efforts to the expansion of the region which the Government are planning. If we had used this Beeching yardstick in this region in the 1930s, when freight was light, because unemployment was heavy, and when the population was leaving the area, we would have butchered the railway system and in the 1940s the region could not have responded to the challenge that the war effort demanded of it.
Precisely the same historical sense should be shown by British Railways now. It should look at the Northern Region as an expanding economic area and see it as one of the most energetic and expansive areas of the United Kingdom. When hon. Members raise this point with the Ministry—and I hope that the Joint Parliamentary Secretary will be more helpful—we are told by officials that this is a managerial problem and beyond their direct control, it being a semi-autonomous public corporation and all that. When we go to British Railways and complain, it says that it has certain statutory obligations, certain rules and regulations, determined by the Legislature and the Ministry, and that we should no blame it for these decisions.
This kind of "buck-passing" has to stop. About a fortnight ago the Newcastle Journal carried an editorial which was extremely sensible. It said that it was right that Members of Parliament should complain about a run-down in their areas when they were hoping for development, but that they should stop directing their fire at British Railways, and direct it instead at the Government.
It is not my intention to embarrass the Government tonight. It is precisely because of the success of the Government's economic policies in this region that we now ask them to face the responsibilities which they have in the Ministry of Transport for at least making sure that British Railways "get with it" and realise that there is a future in this region. We cannot plan regional policy effectively on the basis of British Railways acting independently and ignoring the long-term prospects of Government policy.
We believe that the Minister was right to establish a conurbation transport authority to co-ordinate regional and other transport in this country. I think that this was the first major step towards improving transport services on Tyneside and the northern area generally, but, in the meantime, while these bodies are being established, and doing their research and investigations, there is a need for the Minister to indicate, through whatever channels are available—and I always think that whatever the legal position the usual channels are the most effective—the need to halt rundowns, closures, cut downs and restrictions in development, and to say to British Railways, "We have future economic plans for this region which make it advisable for you to recast your policies for the North of England". In other words, there is a need for railway policy to knit in with the Government's regional policies.
I have tried to put the case as reasonably and dispassionately as possible. I am using language and phraseology which is radically different from that understandably used by the railway workers on Tyneside. They are the most frustrated workers that I have met in recent months, and one might say in passing that something needs to be done to improve labour relations in this industry in the area, because things have been far from satisfactory during the last few months.
There is considerable feeling in the area, not only among workers, but consumers, because here we have a corps of men and women who are trying to develop a line of policy in one direction, with a public body which my constituents see as the Government, whatever the constitutional position may be, doing something quite different.
This is why an early day Motion was put on the Notice Paper, supported by almost every back-bencher in that region, expressing deep concern about the developments which were taking place. I have no desire to overstate my case. It would be unfair and wrong to do so, but I say in all sincerity that one cannot effectively plan the region's economy if the transport authorities do not knit in with the economic policies which are being developed.

11.58 p.m.

Mr. Arthur Blenkinsop: I propose to intervene for only a moment or two to confirm what my hon. Friend the Member for Newcastle-upon-Tyne, East (Mr. Rhodes) has said, and in particular to emphasise the point that we want an efficient and modernised transport system on Tyneside and in the North-East, because our experience on the south side of the river is as my hon. Friend has indicated.
We had the change-over from electric to diesel. We did not altogether object to that. It was done on grounds of economy, and we could understand it, but since then we have had a steady rundown of the services available. There is no service on Sunday, there are no late trains, and so on.
There has been a general deterioration of the stations and of the facilities available for passengers, with the result that we cannot expect to attract the kind of traffic which we ought to be able to attract in an area like this where there is a considerable number of men and women going to work, going back home, and also travelling to the coast for recreation. I emphasise that our experience on the south side of the river amply confirms what my hon. Friend said, and I hope that action will be taken very soon to deal with the situation.

11.59 p.m.

Mr. Bob Brown (Newcastle-upon-Tyne, West): Mr. Bob Brown (Newcastle-upon-Tyne, West) I intervene to emphasise this fact of a public body acting in what I say is direct conflict with the Government's policy on regional development. I want to make particular reference to the movement of the Chief Accountant's department from Newcastle down to York with the merger of the Eastern and North Eastern regions of British Railways.

There is no good reason for any movement of staff from the development area to York, which is outside it. Though the headquarters of the old L.N.E.R. had been at York for generations the chief accountant's department, with a hundred or more jobs involved, had always been in Newcastle. I do not get any pleasure at all when my hon. Friend the Joint Parliamentary Secretary to the Ministry of Labour speaks of only 100 jobs; those jobs are extremely important to an area with over 4 per cent. unemployment at the present time.

I seldom agree with the Newcastle Journal, but I agree with the leader to which reference has been made. If we get the stock answer from Minister and junior Ministers that this is a matter for the management of British Railways, it is high time that the Government examined the legislation to see whether they can have more say in the management than is now possible.

12.1 a.m.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Morris): I have to thank my hon. Friends for the reasonable way in which they have put their case tonight, as they did last week on some of these issues. I agree with my hon. Friend the Member for Newcastle-upon-Tyne, East (Mr. Rhodes) that the very success of the Government's economic policy for the northern region is one of the main causes of his anxiety to ensure that our transport policies march hand-in-hand with the needs of an expanding region. An indication of the Government's concern that economic and transport policies should march together is the presence this evening of my hon. Friend the Joint Under-Secretary of State for Economic Affairs. This shows the significance and importance we attach to ensuring that the left hand knows what the right hand is doing.
I think that I dealt adequately in a previous debate with the movement of staff. I concede that 100 jobs are to be moved from Newcastle to York, but I am sure that my hon. Friends will accept it from me that there are also 1,000 jobs being moved from London to York. This is all part and parcel of the re-organisation of the whole region, stretching from beyond Newcastle down to London: I sympathise with the

personal problems of those involved in the movement, and I know that the unions concerned are at present negotiating with the management on the subject. Nevertheless, the movement must be seen in perspective.
The wagon sheet factory is a matter for management. What is happening there is a result of technological change—change from the use of tarpaulins to lightweight one-man p.v.c. sheets.
Reduction in motive power staff is occurring in various parts of the country in and out of the development areas, and results from the change from steam traction to other forms of traction.
The rest of my hon. Friends' anxieties were connected with the need for transport to be adequate for the area as a whole, both internally and externally. Rail transport has three vital roles to play in the integrated transport system which is being planned for the country. These are, first of all, high-speed passenger services between main conurbations and city centres; secondly, highspeed movement of full train-load freight and, thirdly, commuter services into conurbations.
All three rôles exist on Tyneside, and I shall hope to persuade my hon. Friends that we do look at Tyneside in relation to the rest of the country; and that British Rail is to the fore in providing services to match the needs of this important development area. It is very important that transport should match these needs. My Minister is well aware of this, and anxious to ensure that the northern region has a fair crack of the whip.
Let me deal, first, with the external services—and with the passenger side to begin with. Passenger services between King's Cross and Tyneside are among the finest in the country. Through daytime services between Newcastle and London have recently been increased from 11 to 13 each day in each direction, and four of these are scheduled to take less than four hours—in fact, including a record 230 minutes—for the 268-mile journey.
These services have benefited over the past few years from track relaying and strengthening of the permanent way with long welded rails, and modern signalling equipment; and, with the introduction


of diesel traction, we have been able to maintain higher train speeds which must be welcome to the traveller, whether on business or pleasure.
So far as freight is concerned, a freightliner depot at Follingsby, near Jarrow, is now under construction and should be ready to go into operation in the autumn of this year. Services are planned to run initially to London, Glasgow, and Birmingham, but there will be capacity for further services to other places according to traffic demands which it is hoped will build up in the future. The new open terminal policy of the National Union of Railwaymen will help forward the rapid expansion of traffic and I am sure that this development will bring great benefits to Tyneside. The freightliner development follows the streamlining and rationalisation of the freight sundries services which the Board has been actively pursuing.
As for what I might term the internal area, the commuting situation on Tyneside has not developed to the stage where rail services are the main means of commuter transport, and although both the north and south sides of the Tyne are served by railway services to the coast, these have not been fully utilised. The former electric services along the south side were dieselised about two years ago, and the north bank services are now also being dieselised. But, these services are run at a heavy loss, and it has been impossible to justify the capital costs of replacing the life-expired electrical equipment. This would have been substantial; the capital cable renewal alone would have cost £100,000.
It has been suggested that the Railways Board might defer dieselisation until the setting up of a conurbation transport authority, but the Board has felt unable to agree to further postponement which, incidentally, would have added substantially to its deficit. The operating loss alone is running at around £120,000 a year and dieselisation will halve this, while overall services will be only fractionally slower than the electric services. The round trip journey will take some 64 minutes, as compared with the 58 minutes of the electric service. This is very little slower, and I hope that the fears expressed about the new service will turn out to be unfounded, and I

hope that some people will enjoy a better service once it starts.
There will, of course, be difficulties along the line, so to speak, but British Railways is trying to improve and extend its services to meet the needs of the travelling public. There is, of course, the other side of the coin; the closure of some services. The Board has found it necessary to propose for closure a number of stations served by stopping trains. In particular, the Newcastle-Carlisle line, where the Minister exercised her discretion as to resulting hardship, and consented to the closure of only seven out of the 10 stations proposed.
In the case of the Newcastle-Berwick line, there is a proposal currently before the Minister to close four of the 11 stations on the main east coast line. She will take full account of the advice of the T.U.C.C. and Regional Economic Planning Council before giving her decision. Both main lines are marked in black on the map which was published today as part of the basic railway network for development. I think that this will relieve a great deal of anxiety in the area. Under the Beeching-Marples philosophy, the future would have looked pretty bleak for the country as a whole and, of course, especially for the northern region.
The map published today gives fresh hope to the railwaymen and to the whole of the railway industry. We place great emphasis on the advice—although, of course, the decision must rest with the Minister—of the Planning Council on any issue of closure. The Council is able to take a very broad and long-sighted view of any situation—of future development as well as existing need—and the Regional Transport Coordinating Committee will be an important weapon in ensuring that the transport needs of the whole Northern Region are looked after. I hope that my hon. Friends will go from here tonight knowing that the Ministry is well aware of the importance of Tyneside and the need to provide it with adequate transport.

Mr. Bob Brown: My hon. Friend referred to trade union consultation which had taken place on this merger proposal. It is true that such consultation did take place on the 1,000 jobs moving from London to York but at the


time I tabled my last Question on this matter no trade union consultation whatever had taken place about the 100 jobs moving from Newcastle to York.

Mr. Morris: I spelt out part of the situation regarding trade union consultation in the last debate. There was consultation between the T.S.S.A. and my right hon. Friend about the issue of principle involved—the amalgamation of the two regions. Once the decision on amalgamation had been taken, the choice of where the new regional headquarters was to be was one for the Rail-

ways Board. I understand that consultations are proceeding between the unions and the Board on this issue, which is one for management decision. But I assure my hon. Friend that, once a decision was taken in the national interest about amalgamation, within that new policy there is adequate machinery for the fullest possible consultation between the unions and the management.

Question put and agreed to.

Adjourned accordingly at twelve minutes past Twelve o'clock.